Australian airline Qantas Airways to cut 500 jobs

Australian airline Qantas Airways plans to axe 500 jobs and cut capital spending by $700 million over two years, after a bitter industrial dispute and high fuel bills halved its first-half profit.

The cuts are designed to protect profitability and an investment grade credit rating at Qantas, which suffers from a higher cost base than its Asian peers.

Qantas employs over 90 percent of its 32,500 employees in Australia, and union fears that it will send jobs offshore helped spark last year’s bruising industrial battle that led to the grounding of its entire fleet and prompted intervention by Australia’s industrial umpire.

The airline also planned to consolidate some engineering, ground and maintenance operations in its Sydney hub, and was in talks to sell some catering centres.

Qantas has not had a good run in recent times. Besides trouble with employees, its flagship A380 superjumbo fleet has suffered wing cracks due to design and manufacturing flaws.

From Reuters