Qantas restructures to turn around international business

Qantas is splitting its international and domestic operations in a major shake-up which sees two key executives leave the airline.

Qantas International and Qantas Domestic – currently combined as Qantas Airlines – will be formally managed as two distinct businesses under the new structure from July 1.

Each will have its own chief executive and its own operational and commercial functions. Their financial results will also be reported separately.

“This change will enable a greater focus on the priorities of turning around the Qantas International business and enhancing the strong Qantas Domestic business, as part of the overall group strategy,” the Australian carrier said.

The chief executive of Asian low fare subsidiary chief executive Bruce Buchanan is to stand down in six months’ time and group executive commercial and freight Rob Gurney is leaving after 14 years.

The restructure comes as the next phase of the five-year transformation plan launched last August. Group chief executive Alan Joyce said: “Qantas Domestic and Qantas International face very different situations.

“Qantas Domestic is strong and profitable. We are seeing the most sustained levels of high customer satisfaction on domestic services since 2004, and we are the airline of choice for corporate Australia.

“But we cannot be complacent – we must continue to offer customers the best network, frequency and flying experience in the domestic market, and find new ways to earn and reward their loyalty.

“Qantas International, a great airline with a rich history, is loss-making and does not deliver sustainable returns. However, we are committed to turning it around through the five-year strategy we announced last year, based on flying to global gateways, deeper alliances, smart investment in product and disciplined capital management.”

He added: “Formally separating the management of Qantas International and Qantas Domestic will ensure that we can independently run each business according to its specific priorities and market conditions.

“These measures give us the right structure to address the challenges and opportunities we face – and the right people. We have begun the process of restoring Qantas International to a sustainable position.”

Simon Hickey, currently chief executive  of Qantas frequent flyer is to head  Qantas International, while Lyell Strambi, moves from his role of Qantas Airlines operations group executive to head the domestic arm.

Strategy and technology group executive Jayne Hrdlicka takes over as chief executive  of Jetstar as part of a number of senior management changes.

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