Qantas quantifies industrial action losses.
Qantas ceo Alan Joyce has just updated investors on the costs of the ongoing industrial campaigns against the airline, saying the actions are “now having a major impact” on the carrier.
He said the uncertainty caused to passengers by the unrest is costing Qantas approximately $15 million per week in lost revenue, with a cumulative total now amounting to $68 million.
The announcement was part of an update coinciding with the Qantas annual general meeting this morning, with Joyce saying that first half yield for 2011/12 is expected to be up to 6% higher than in the previous corresponding period.
The Qantas Group expects to increase capacity by 6-7% this half, while underlying fuel costs for the six months will be up by around $500m to $2.2 billion due to higher forward market jet fuel prices and increased flying.
“Fuel surcharges, fare increases and hedging are being used to mitigate the impact of fuel price rises but are unlikely to fully offset the cost increase,” he said.
Qantas is not providing profit guidance at this time because of the volatile economic and industrial environment, and warned that any future industrial action will “increase the unfavourable impact on the group’s profitability”.
Joyce reiterated the airline’s commitment to its ongoing change program, saying that “agreeing to the unions’ unreasonable demands would have a far greater cost on the company including risking the future of Qantas”.
More information in today’s Travel Daily.