Qantas wants further “ad hoc” border closures ruled out as Australia’s vaccine program rolls out, warning of further redundancies if uncertainty continues.
“It’s been a very sad year,” Qantas domestic and international chief executive Andrew David told a parliamentary inquiry into the future of Australia’s aviation sector post-COVID-19.
Qantas took drastic action to cut its workforce, grounded most of its fleet and last week posted a record loss of more than $1 billion for the first half of the 2020/21 financial year.
“If we saw state borders close again the impact is going to be huge,” Mr David said.
Quizzed about its expectation for 40 to 50 per cent of international business to return by November, Qantas said this is based on assumptions about the rollout of COVID-19 vaccines here and overseas.
But the airline doesn’t expect to be back to pre-COVID levels until 2024, seeing no service for its A380s until the end of 2023.
Qantas wants the government to extend and enhance all aviation support packages at least until international borders reopen, but didn’t argue for the JobKeeper support payment to be extended beyond March 31.
International Transport Workers’ Federation spokesman Scott McDine called for an “AviationKeeper” wage subsidy to replace JobKeeper, which ends on March 31, and shared data about 18 countries doing more than Australia to support the industry’s workforce.
“You’ve got to have a workforce that can respond post-pandemic,” Mr McDine said.
He agreed border closures had decimated once-lucrative routes in Australia and airlines faced an uncertain policy environment.
Regional airline Rex is lobbying for an extension of the federal Regional Airline Network Support program beyond its March 28 snapback as well as some help to keep staff in place with JobKeeper set to finish.
“We understand it’s not going to be extended in its current form but we hope there’ll be some form of assistance to keep airline crews available,” Rex deputy chair John Sharp said.
Regional communities are connected to capital cities thanks to RANS and without it some routes will not be viable, he warned.
Rex has been accused by rivals of using federal handouts to fund an expansion into the market’s golden triangle, adding Australia’s busiest route between Sydney and Melbourne to its schedule this week.
“It’s certainly not true at all,” he told the senators, arguing Rex was profitable and debt-free, owned its fleet, buildings, pilot training units, and had raised capital for its new operations.
“We are not funding our expansion with Commonwealth funding,” Mr Sharp said.
He also welcomed extra powers given to the competition watchdog to monitor the behaviour of Qantas.
“Small regional routes lead to fragile economics,” Mr Sharp said.
The Qantas motto is the “spirit of Australia” but he questioned whether that spirit meant “beating up the little guy”.
Qantas group public affairs executive Andrew Parker called for national cabinet to focus on aviation in the coming days and weeks so people have certainty about being able to get home if they travel.
“At the moment there is enormous confusion,” Mr Parker said.
But the airline was slapped down for chief executive Alan Joyce’s no-show as two days of hearings began on Wednesday.
Labor Senator Tony Sheldon said it was “disappointing” Mr Joyce hadn’t found time to speak to the committee, unlike the head of Virgin.
Treasurer Josh Frydenberg says measures are being considered for a range of industries, including the aviation sector.