In response to rising fuel prices, Qantas Airways
(ASX:QAN) has announced a series of cost cutting measures.
Australia’s largest airline will reduce capacity on domestic and international services, retire some aircraft and trim down on management positions as it battles against fuel charges and the impact of natural disasters.
Capacity growth on its domestic routes is now planned to drop from 14 to 8 per cent, while international capacity growth will fall from 10 to 7 per cent.
Qantas CEO Alan Joyce says the significant and sustained increases in the price of fuel is the most serious challenge Qantas has faced since the Global Financial Crisis.
Last week Qantas again hiked the price of its domestic fares, for the second time this year, and warned that it cannot rule out further increases in surcharges and fares in the future.
Qantas booked a net profit of $239 million in the six months to 31 December 2010.
