Qantas CEO Says Perth Service Unsustainable
2nd May 2014
Alan Joyce, the CEO of the Australia?s flag carrier, admitted that the Perth's international routes are no longer sustainable to keep their operations.
He said that the termination of the remaining international flights was a tough decision considering that Perth has been part of the carrier's network since the early days of its operations. This amidst the airline's effort to cut costs and its aim to be profitable again.
Speaking to the Chamber of Commerce and Industry of Western Australia yesterday, Alan Joyce said that sometimes there are hard decisions to make and, unfortunately, the time has come for us to face the truth, the sad truth.
The airline official also cited the growing competition in the country's commercial aviation industry where overcapacity is the primary concern of most carriers today coupled with skyrocketing fuel prices in the world market.
He admitted that he is aware of the impact of Qantas withdrawal from Perth on the city's position as an international gateway of the country. However, he explained, they also need to rationalize their international network in certain areas.
The flag carrier is planning to slash its operating costs in the next three years by $2 billion, easily becoming the biggest reform program ever implemented in the airline's history.
Qantas will soon severe the Perth-Singapore link on the 12th of May, leaving travelers to the city state with a choice of Jetstar Asia, its low-cost subsidiary. The state-controlled airline, though, will operate flights on a temporary basis between July 3-12 for the peak holiday season as demand is expected to rise.
From December 5, 2014 to April 26, 2015, the Red Roo will also temporarily ply a twice-weekly service between Perth and Auckland, New Zealand.
Emirates, Qantas' airline partner through a bilateral alliance, will take over its three-time daily service between Perth and Dubai. The Gulf-based carrier is reportedly planning to use one of its A380 fleet on one of these thrice-daily flights.
The departure of Qantas from Perth will somewhat give a breather to its competitors who serve the same routes. Etihad Airways is seen to start daily service between Perth and Abu Dhabi beginning July 15 this year. Cathay Pacific and Singapore Airlines will also increase frequency of their daily service between Hong Kong and Singapore, respectively. Thai Airways, on the other hand, will start fielding its B787 Dreamliner jets between Perth and Bangkok from July 1.