Qantas airline to cut 20% of its employees and growing 1.3 billion dollars amid COVID-19

Qantas airline to cut 20% of its employees and growing 1.3 billion dollars amid COVID-19
Qantas' aircraft are grounded, Source:Web

Qantas, the world’s third oldest airline, is losing 6,000 of its employees and operating to boost up to 1.3 billion USD (1.9 billion Australian dollars) as flights are facing severe situations to pass through the pandemic Coronavirus.

 On Thursday, the cuts have announced which is twenty percent of the total employees of 29,000 people, the company says. Moreover, they will basically impact on flight staff, ground, and corporate of the airline. Besides this, the budget carrier of the company, Jetstar, will be affected.

The airline company even developing severe alterations to its fleet as a portion of the big 3-year strategy to support its business and recover it from the historic collapse in travel all around the world. Maximum of the company’s international jets or up to a hundred aircraft will be grounded for the next complete year, Qantas said. Furthermore, the company’s 6 Boeing 747 jumbo aircraft will be retired for 6 months according to schedule.

The novel guidelines are probable to support the company, and even it will reduce costs by ten billion USD (15 billion Australian dollars) for three years. Subsequently, the company will target one billion Australian dollars for savings each year.

The company offers its shares at a 13% discount

This year, the company’s shares dropped to 41 percent, and on Thursday, in Sydney, shares were stopped from trading when Qantas made an announcement. The company’s fundraising strategy will include providing 933,000 USD (1.36 billion Australian dollars) worth of shares to investors at around 13 percent discount to the actual price closing on Wednesday.

Qantas airline to lose 20% of its employees amid COVID-19
Qantas facing severe difficulty to perform further operations, Source:Web

The remaining five hundred million dollars will be pursued via the separate sale strategy and provided to current investors.

As a leader to the turnaround plan, Alan Joyce, CEO of the company, even decided to sustain his part till the end of the 2023 fiscal year.

In a statement, Alan Joyce said that right now, almost all airlines are standing in the middle of the of drastic situation that our industry has ever experienced, and the effect will be felt for an extensive period. On the other side, on Thursday, ASU (Australia’s Services Union) argued that it was very early for the company to cut employees and union called the federal government and the airline to defend employees’ salaries.

In a statement, the union said that this declaration by the company is premature, and the Australian economy couldn’t bear a significant contraction of the airline industry.

While announcing the statement, the CEO said that the crisis didn’t leave any choice.