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Wednesday, 14 November, 2001, 23:31 GMT
Qantas slashes routes and jobs
Qantas terminal
Qantas is to stop flying to New York
Australian airline Qantas said it will cut up to 2,000 jobs by the end of this year and stop flying to New York because of the collapse in international travel.

Australia's biggest airline will also reduce services to other international destinations, including Rome, Johannesburg, Bangkok, Manila and Buenos Aires.

Qantas, which is 25% owned by British Airways, made the bulk of its profits - 78% - from international flights in the 12 months to June 2001.

The moves are part of a restructuring that will increase the airline's reliance on the domestic Australian market, where it got a boost last month from the bankruptcy of rival Ansett.

Bookings drop

But Qantas chief executive Geoff Dixon made clear the driving force behind the cuts was "a significant downturn for travel to and from Europe, South East Asia and Japan".

The reduction in international flights will take Qantas' capacity cuts to 11% since 11 September, when terrorist hijackings threw the aviation industry into crisis.

Qantas said bookings from the UK are down 23% and demand for flights to Japan has fallen by 25%.

Unpaid leave

Mr Dixon said the airline will also ask staff to take unpaid leave and to consider job sharing.

Between 1,500 and 2,000 jobs will be trimmed by the end of December. The airline said redundancies would be needed but did not detail how many.

Some staff will be switched from international to domestic routes.

Qantas recently said it would order 17 new planes to serve domestic routes following the collapse of Ansett.

US tie-up

Last month, Qantas signed a 10-year strategic deal with United States' biggest carrier, American Airlines.

The package includes expanded code-sharing provisions, which ease passenger connections between the two airlines.

It also granted Qantas access to more US terminal space, including access to American's Los Angeles terminal, and the right to take over 15 aircraft ordered from Boeing.

Qantas will withdraw its flights to New York from 25 November.

News of Qantas' refocused strategy came just hours after the administrator dealing with the affairs of Qantas bankrupt rival Ansett said talks with the government had failed to produce state funding for a rescue package.

See also:

29 Oct 01 | Business
Qantas signs deal with American
18 Oct 01 | Business
Qantas bucks plane order slump
09 Oct 01 | Business
Airline losses seen trebling
16 Aug 01 | Business
Qantas profits slump
11 Sep 01 | Business
Qantas poised for airline deal
17 Sep 01 | Business
Ansett administrator quits
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