Coronavirus has forced Qantas to cut capacity across Asia due to a slump in demand expected to cost the Australian carrier up to A$150 million (£76 million).
The 15% overall reduction will last until at least the end of May following an “extraordinarily difficult” few months for the Australian tourism sector, hit by the bushfires crisis.
Qantas flights between Sydney and Hong Kong will be halved to seven a week, with reductions on Hong Kong services to Brisbane and Melbourne.
A Melbourne-Singapore service will see capacity reduced by 250 seats per flight as Boeing 787s replace Airbus A380 super jumbos on the route.
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Capacity is also being trimmed by 5% between Australia and New Zealand and by 2% on domestic routes in Australia.
The airline stressed that no other changes to the Qantas international network, such as the UK and US, were being made. The airline described ultra-long haul routes such as Perth to London as continuing to “outperform”.
Sister carrier Jetstar will cut capacity to Asia by 14% until at least the end of May, including flights to Japan and Thailand.
Group chief executive Alan Joyce said action was being taken now to limit exposure to softening markets.
“Coronavirus resulted in the suspension of our flights to mainland China and we’re now seeing some secondary impacts with weaker demand on Hong Kong, Singapore and to a lesser extent Japan,” he added.
“Other key routes, like the US and UK, haven’t been impacted.
“We’ve also seen some domestic demand weakness emerging, so we’re adjusting Qantas and Jetstar’s capacity in the second half.”
Joyce said: “What’s important is that we have flexibility in how we respond to coronavirus and how we maintain our strategic position more broadly.
“We can extend how long the cuts are in place, we can deepen them or we can add seats back in if the demand is there. This is an evolving situation that we’re monitoring closely.
“We know demand into Asia will rebound. And we’ll be ready to ramp back up when it does.
“These past few months have been extraordinarily difficult for the tourism industry and we’ve tried to minimise the impact of our capacity reductions as much as possible.
“About half of Qantas’ domestic cancellations are between Sydney, Melbourne and Brisbane, and we’re avoiding any route exits.
“The capacity we’re taking out is the equivalent of grounding 18 aircraft across Qantas and Jetstar until the end of May, which in turn impacts about 700 full time roles.
“To avoid job losses we’ll be using leave balances across our workforce of 30,000 and freezing recruitment to help ride this out. We’ll also take advantage of having some aircraft on the ground by bringing forward planned maintenance.”
He was speaking as the Qantas Group reported a 6.2% drop in first half profits to A$648 million.
A further update on the negative impact of coronavirus will be issued with a third quarter trading update in April.
All Nippon Airways is also suspending or trimming capacity on a number of routes between Japan and China from today, including services from Tokyo and Kansai to Beijing and Kansai to Hangzhou until March 28.
“ANA will continue to closely monitor the situation and will take appropriate action when needed,” the carrier said.
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