Qantas Airlines cutting flights due to surging oil prices

Qantas Airlines cuts flights due to high fuel costs

Qantas Airlines are following other carriers in scaling back services largely due to rising fuel prices and also because of natural disasters hitting some of its key destinations.

The carrier said it plans to cut costs by scaling back flights and letting go of some personnel.  Domestic seats will go down from 14 percent to 8 percent while international capacity will drop 10 percent to 7 percent, the airline said.

It said that it expects to incur $2 billion in fuel costs through June as the conflict in the Middle East and North Africa rages on.

"The significant and sustained increases in the price of fuel is the most serious challenge Qantas has faced since the global financial crisis," Qantas Airlines chief executive officer Alan Joyce wrote in a statement.

Home turf Australia and neigboring New Zealand have experienced calamities recently. Japan, another major market for the airline, was also hit my multiple disasters. Taken together, Qantas Airlines estimates losses of some $140 million from January until June due to the calamities that hit the three countries.

Another significant blow to the carrier was the grounding of its A380 superjumbo planes after a mid-flight explosion hit one of the aircraft in November.

"We need to act decisively to respond to rising fuel costs and natural disasters...to ensure the ongoing sustainability of our business," Joyce added. Qantas has earlier hiked fares on both domestic and international flights to further cut operating costs.

Budget carrier partner Jetstar will lessen flights to quake-hit Christchurch from other cities in New Zealand and Australia.

Qantas Airlines will also halt four weekly flights to Japan from April to August because of weak demand amid the radiation scare there.

Posted by Sophia Andrews on Thursday March 31 2011, 7:02 AM EST. Ref: AP. All trademarks acknowledged. Filed under Featured News, Travel. Comments and Trackbacks closed. Follow responses: RSS 2.0