Qantas Airways Ltd will cut domestic capacity by 10 more percentage points, to 60% of pre-COVID-19 pandemic levels, in the March quarter after the state of Western Australia indefinitely delayed opening its border, the carrier has said.
Health Risks
The opening planned for February 5 was cancelled, with authorities in Western Australia citing health risks from a surge in the Omicron variant of COVID-19 in eastern states.
Qantas Statement
In a statement, Qantas said, "The group retains the flexibility to adjust flying levels depending on demand and clarity on border reopening in the weeks and months ahead."
Preparing For A Surge In Demand
Last week, the airline had pared approximately a third of planned domestic and international capacity in the March quarter, to better match demand amid rising COVID-19 infections.
Preparing for a surge in demand, it had recently recalled approximately 11,000 staff who had been idled without pay during the pandemic.
Impact
The move increased fixed costs and the recent capacity cuts will squeeze revenue and reduce margins.
Qantas, which ends its financial year in June, said that it will give more details on the impact of the changes in half-year results late this month.
Virgin Australia
Rival Virgin Australia said that it will review its flight schedule to Western Australia to keep in line with the state's arrangements to reopen its borders.
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