Qantas CEO says airline came within 11 weeks of financial collapse during COVD-19

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Qantas Airways Ltd. came within 11 weeks of financial collapse at the height of the pandemic as travel ground to a halt and the airline continued to lose cash, Chief Executive Officer Alan Joyce said.

In a lunchtime speech in Sydney on Monday, Joyce said that in early 2020 she was receiving weekly reports from her finance team making it clear how long the airline’s bookings would last. Qantas’ minimum life expectancy was gradually lengthened to two years after it raised capital, sold land and cracked down on spending, he said. rival virgin australia collapsed at the same time.

Joyce’s revelation goes some way to counter criticism that she cut costs, including more than 8,000 workers, too aggressively during Covid-19, leaving the airline struggling to cope when demand eventually picked up. With a reduced workforce, Qantas this year has been plagued by flight cancellations, lost bags and delays.

“People forget how low everything was in March, April, May and June of 2020,” Joyce said. “There was no vaccine. There was no hope that it could be as effective as it was. We had to contemplate these 11 weeks of survival.”

Qantas has now built in buffers to help bring service levels back to normal. There are 20 aircraft reserved and ready to be deployed at any time should operational problems arise, he said.

Still, tangles in the supply chain are problematic and may not be fully resolved for another 18 months, he said. Spare parts are hard to come by, with planes sometimes being out of service for days compared to hours before the pandemic, he said.

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