Sydney Lockdown: Qantas Cuts Domestic Flights, Lays Off 2,500 Employees

JAKARTA - Australian airline Qantas Airways Ltd. has temporarily suspended around 2,500 employees without pay for at least two months, as domestic flights are cut due to COVID-19 restrictions.

The decision will directly impact domestic pilots, cabin crew and airport workers, mostly in New South Wales, the airline said on Tuesday, hoping it would not be followed by further action that would put employees out of work.

Qantas said the COVID-19 surge caused by the Delta variant cost it about 60 percent of its revenue last July, down considerably compared to last May.

Sydney, Australia's largest and most populous city and economy, has been hit by this wave of infections, undergoing a lockdown since June which will end on August 28, if the situation allows.

"Based on the current number of cases, it is reasonable to assume that the Sydney border will be closed for at least another two months," Qantas Chief Executive Alan Joyce told reporters.

The domestic aviation division employees will join some 6,000 colleagues in the international division who are also being laid off due to the border closures and will receive a government support allowance of A$750 a week. Qantas has approximately 22,000 employees in total.

The airline said it was seeking to increase domestic flight rates to around 50 percent-60 percent of normal levels within weeks, as several states reopen borders after exiting lockdowns.

"Qantas will not be hibernating its domestic aircraft, as it wants to be able to increase speed quickly when demand returns, with the goal of reaching 100 percent pre-COVID capacity by next Christmas," Joyce said.

Please note, Qantas' international fleet has been grounded since March 2020. The airline currently has many international flights on sale starting late December. But Joyce said the status of the plan would depend on Australia's COVID-19 vaccination rate.

Last week, the Australian Government set a target to fully vaccinate around 80 per cent of adults, to reopen its international borders. Currently, only about 18 percent of adults have been fully vaccinated.