Qantas to lay off pilots in bid to revive profits

SYDNEY, May 14, 2014 (AFP) - Struggling Australian airline Qantas on Wednesday said it will make dozens of pilots redundant for the first time in 40 years as it looks to slash costs to contain massive losses.

The national carrier, which announced it would cut 5,000 jobs from its workforce in February, will call for voluntary redundancies among its Boeing 747 and 767 pilots.

A spokesman said the airline was not placing an exact number on the redundancies until the application process was complete but reports said up to 100 positions, or just under 20 percent of the 550 pilots for both fleets, were being targeted.

Qantas has around 2,000 pilots on its books.

The airline previously said it would retire both its ageing 747 and 767 fleets as part of a plan to save Aus$2 billion (US$1.8 billion) over the next three years, with chief executive Alan Joyce saying the airline was facing "some of the toughest conditions" it had ever seen.

Qantas chief pilot Dick Tobiano said in an internal message that plans to accelerate the retirement of the planes meant the airline was no longer able to manage the staff surplus through leave arrangements.

"It is anticipated that exits would be staggered corresponding with network and fleet reductions," he said.

The Australian and International Pilots Association (AIPA) said the redundancies were "regrettable" but it would work with the company to "ensure the process was managed with as little pain to individual pilots as possible".

"Obviously from AIPA's perspective it is far better to see fleet reductions managed with older pilots stepping out on their own terms, rather than younger pilots being made redundant compulsorily," AIPA president Nathan Safe said.

While the cuts could see some of Qantas's most experienced pilots leave, Safe told the Australian Broadcasting Corporation he did not "have any concerns about a lack of experience resulting from this - not at all".

"Many of the pilots who won't take the package or won't be targeted by the package are also some of our most experienced pilots."

Tobiano stressed to the pilots affected that the cuts did not reflect their contribution to Qantas but the "realities of our fleet plan and the realities we face".

Qantas has lobbied the government for support after it announced a Aus$235 million loss in the six months to December 31 as it grapples with competition from domestic rival Virgin Australia, which is majority-owned by state-run Singapore Airlines, Etihad and Air New Zealand.

Its plea for a debt guarantee, or a Aus$3 billion unsecured loan, was rejected, but the government said it would relax the Qantas Sale Act, which would remove restrictions limiting foreign ownership in the airline to 49 percent.

The bill passed the lower house of parliament in March but has yet to reach the upper house Senate.