‘Standstill’: Qantas boss’ grim prediction
Despite reporting a significant spike in domestic bookings as borders begin to open around Australia, Qantas boss Alan Joyce says he fears international travel will take years for a similar recovery.
With the reopening of domestic borders, particularly along the east coast this week, the airline predicted the domestic capacity would be sitting at almost 70 per cent of pre-COVID levels by December and rising to nearly 80 per cent at the beginning of 2021.
"We've seen a vast improvement in trading conditions over the past month as many more people are finally able to travel domestically again," Mr Joyce said in the Qantas Group market update.
"There's been a rush of bookings as each border restriction lifted, showing that there's plenty of latent travel demand across both leisure and business sectors."
While Mr Joyce said the opening of the Queensland border with NSW and Victoria has seen 200,000 fares sold in 72 hours, he said the airline would not be seeing any movement in the international travel sector until mid-2021 at the earliest.
"International travel is likely to be at a virtual standstill until at least July next year and it will take years to fully recovery, which means we're carrying the overhead for billions of dollars worth of aircraft in the meantime," he said.
"We're also facing a revenue drop of at least $11 billion this financial year alone compared to pre-COVID.
"Overall, we're optimistic about the recovery but we're also caution given the various unknowns. We also have a lot of repair work to do on our balance sheet from the extra debt we've taken on to get through the past nine months."
Earlier this week the airline announced more than 2000 ground staff roles would be pushed offshore.
Earlier this month, Mr Joyce made global headlines after he revealed once a vaccine became available, it would be a condition of travel with Qantas.
"For international travellers, we will ask people to have a vaccination before they get on the aircraft,'' he said on A Current Affair last week.
"Certainly, for international visitors coming out and people leaving the country, we think that's a necessity."
Mr Joyce suggested anti-vaxxers who weren't happy with that rule may struggle to find an alternative airline to fly with.
"I think that's going to be a common thing, talking to my colleagues in other airlines around the globe," he said.
His comments sparked an immediate wave of fury from people who objected to the policy.
"What right does Alan Joyce have to demand that we will only be allowed to travel with Qantas if we first prove we have been vaccinated against COVID-19?" someone asked on Twitter.
"My health and vaccination status is none of his concern."
Mr Joyce has previously said that flights to international destinations will not resume until a vaccine has become available and that flights to Europe and the US, where the virus is currently raging largely uncontrolled and significant lockdowns are in place, are unlikely until at least the end of 2021 pending a vaccine.
Mr Joyce however said the airline hopes to see travel bubbles with other nations that have managed to contain the virus, such as Korea, Taiwan, Japan Singapore and a two-way corridor with New Zealand.
"We haven't flown to Korea or Taiwan in decades, but we'd put services back into the destinations if we could," he said.
- with Lauren McMah
Originally published as 'Standstill': Qantas boss' grim prediction