Qantas pushes back dates for resuming domestic, overseas flights
Qantas has extended the suspension of its domestic and trans-Tasman flights until the end of June, and for international flights until the end of July.
But Qantas said some capacity could be added back within a week if domestic and trans-Tasman restrictions eased earlier.
āThe initial easing of government restrictions suggests some domestic travel may start to return before the end of July, though initial demand levels are hard to predict,ā Qantas said.
Also, the airline is allowing customers whose flights are cancelled because of the coronavirus crisis to split travel credits across future bookings, and is giving them more time to use the credit.
Australiaās flag carrier said the stand-down of two-thirds of its 30,000-member workforce would be extended until at least the end of June.
Qantas said it had secured further debt funding of $550 million against three of its wholly owned Boeing 787-9 aircraft following the $1.05 billion raised in March against seven of its 787-9s.
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āThe group has sufficient liquidity to respond to a range of recovery scenarios, including one where the current trading conditions persist until at least December 2021,ā Qantas said.
It could raise more funds against its $2.7 billion in unencumbered aircraft assets, Qantas said.
By the end of June, the airline expects to reach a cash burn rate of $40 million a week, which is $2.08 billion a year.
It has $3.5 billion in short-term liquidity, including $1 billion in an undrawn debt facility.
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āOur cash balance shows that weāre in a very strong position, which under the circumstances we absolutely have to be,ā Qantas chief executive Alan Joyce said.
āWe donāt know how long domestic and international travel restrictions will last or what demand will look like as theyāre gradually lifted.ā
With the possible exception of New Zealand, it could take years for international travel demand to return to what it was, Joyce said.
The airline is currently operating about 5.0 per cent of its pre-crisis domestic network and 1.0 per cent of its international network.
The airline would have to review the size of its fleet, network and capital expenditure, Joyce said, adding āour commitment to serve communities across Australia will not changeā.
Qantas said it had closed out all its hedged positions for its fuel needs in early April, incurring losses but avoiding the precipitous falls in oil prices that occurred in the second half of the month.
The airline had hedged all its fuel needs for the year as a means to protect the airline from fluctuations in the price of jet fuel, which delivered significant benefits in the first half but resulted in losses as the pandemic caused a drop in oil prices.
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