Qantas cuts another 2000 jobs, outsources baggage handling in a bid to save $100million

Qantas is cutting 2,000 more jobs and outsourcing baggage handling in a bid to save $100million a year in costs.

The flying kangaroo airline had already retrenched 8,500 staff since the start of the coronavirus pandemic in March.

The latest cutback takes the job losses tally to 10,500 in just eight months, even though Qantas is set to have an even bigger market share as its rival Virgin Australia shrinks to survive.

Qantas is cutting 2,000 more jobs and outsourcing baggage handling in a bid to save $100million a year in costs 

Qantas announced on Monday its ground handling operations would be outsourced at ten airports across Australia in a bid to save $100million annually.

The carrier, this year celebrating its 100th anniversary, said it would save $80million over five years by no longer having to spend big on aircraft tags and baggage loaders.

In August, Qantas axed 2,500 ground crew jobs on top of 6,000 existing redundancies and has since held tense meetings with the Transport Workers’ Union about more job cuts.

Fat Prophets head of research Greg Smith said uncertainly about the resumption  of international travel and pressure from the Australian Competition and Consumer Commission on domestic prices meant Qantas had little choice but to cut costs.

‘There will certainly be complaints if the airline is perceived to be making the best of  bad situation and even price gouging,’ he told Daily Mail Australia.

‘Cutting costs is one way to increase margins rather than just hiking fares.’ 

Qantas announced on Monday its ground handling operations would be outsourced at ten airports across Australia in a bid to save $100million annually

Qantas chief executive of domestic and international operations, Andrew David, said the COVID-19 border closures meant international travel wouldn’t return to pre-pandemic levels until 2024.

‘Unfortunately, COVID has turned aviation upside down. Airlines around the world are having to make dramatic decisions in order to survive and the damage will take years to repair,’ he said.

‘While there has been some good news recently with domestic borders, international travel isn’t expected to return to pre-COVID levels until at least 2024. 

‘We have a massive job ahead of us to repay debt and we know our competitors are aggressively cutting costs to emerge leaner.’

The job cuts had little effect on the Qantas share price, which was still at $5.52 almost an hour after the 12.25pm AEDT announcement. 

Nonetheless, its share price is more than double the $2.14 low reached in March as the World Health Organisation declared a COVID-19 pandemic and Australia shut its border to non-residents and non-citizens. 

Last month, Qantas CEO Alan Joyce told shareholders the airline’s domestic market share would climb from 60 per cent before the pandemic to 70 per cent as state borders were reopened.