Wednesday 9 February 2011
Qantas future at risk
Qantas' international arm is under increasing pressure from an influx of competition over the last eight years, to the point where the airline's future is at risk according to chief executive, Alan Joyce.
Mr Joyce spoke to the Melbourne Press Club and said that in the years between 2003 and 2009 capacity coming to Australia had grown by 39% thanks to China and the Middle East, but inbound passenger growth had risen by just 10%.
Mr Joyce said this indicated that new airlines weren't growing the market, but merely taking a share of the existing demand.
“And the result is that Qantas International market share has fallen from 35% to 20%. As an end-of-the-line carrier, serving a market of 22 million people in a marketplace flooded with so much capacity that our competitors aren’t even using their full quota, we face severe limits to growth," he said.
“If we continue on our current path, there will be a real question mark over the viability of Qantas International.”
Mr Joyce added that the troubles which have plagued the A380 have also contributed to their predicament. “Qantas was certainly hurt by the events of last year and we know there is rebuilding to do,” he said.
In response, Mr Joyce announced that a taskforce has been established to look at potential new routes in order to generate new income streams and ultimately protect jobs.