Qantas still operating minimum essential international links; seems to suggest opening up New Zealand travel first

Qantas today announced a further extension flight cancellations on most international services in June and July. Flights between Australia and New Zealand will however be cancelled up to end-June for now.

Before this, practically all flights up to end-May were cancelled, except for a handful of services to four international hubs for the most essential travel.

Domestic travel within Australia has also be scaled back to a bare minimum, as many states have imposed travel restrictions and isolation requirements. These reductions are also extended till at least end-June.

Qantas however has caveat that “some capacity can be added back in if domestic and Trans-Tasman restrictions ease in coming weeks”.

What does it mean for customers

Assuming you still have a booking for June and July (not sure why you are still holding on to hope for travelling now, but that’s another conversation), these flights will automatically be cancelled.

You will be contacted with an option to receive your credit, which can be used towards a next flights within 12 months.

Note that if you want a cash refund, they will charge you a refund fee so that’s not advisable.

Raising cash

Qantas Group announced the cancellation extensions today along with a loan announcement, having secured A$550 million in funding, with three of its wholly-owned Boeing 787-9 aircraft as collateral. This follows an earlier A$1.05 billion raised in March against seven of its dreamliners. Qantas has 11 dreamliners for now, which it bought with cash a few years ago.

Qantas has now a total of A$3.5 billion in short-term liquidity, including other un-pledged assets. It has also said that it is currently burning cash at about A$40 million a week, after all the cost reduction measures, including putting about two-thirds of its employees on leave. This means that even if the coronavirus situation persists, the airline will still have enough funds to last it through another 18 months based on current circumstances.

Australia, New Zealand thinking of forming travel ‘bubble’

The two largest countries in the Pacific has so far sealed off their borders for more than a month, with even movement within the country highly restricted.

Even as both countries work towards opening up their respective country’s economy and transport, both country’s leaders have also committed to working towards opening international travel between both countries at the same time.

Both countries have jointly announced last week working towards a “Trans-Tasman bubble” to boost tourism, trade and business ties, with Qantas CEO being optimistic in resuming flights to New Zealand ahead of other international destinations.