Qantas Airways has revealed plans to cut up to 1,000 jobs as part of a major shake-up of its international business which will include the launch of a new Asia-based airline.
The flagship Australian carrier, which is struggling to offset losses from its international operations, will buy between 106 and 110 Airbus A320 aircraft, and retire older planes as part of the five-year plan. It will also defer the delivery of six Airbus A380 superjumbo planes for up to six years.
The changes are expected to affect around 1,000 jobs, Qantas said.
Qantas International has forecast a loss of £130 million for the 2011 financial year due to competition and costs that the airline says are 20% higher than its key competitors such as Emirates.
Chief executive Alan Joyce said the changes are needed to ensure the airline's profitability.
"Qantas International is a great airline with a proud history," he said in a statement. "But it is suffering big financial losses and a substantial decline in market share. To reverse that decline we need fundamental change."
Under the plan, Qantas will invest in a new premium airline in Asia which will operate under a different name. It will also launch a budget airline in Japan to be called Jetstar Japan in partnership with Japan Airlines and Mitsubishi.
Unions immediately condemned the move, with the Australian Council of Trade Unions accusing the airline of showing "blatant contempt for its loyal workforce".
"This is one of the darkest days in the history of Qantas," Actu secretary Jeff Lawrence said in a statement.
"Today, Qantas management has turned its back on Australia and on Australian jobs to head down the path of a race to the bottom that would see a large section of its workforce employed on the pay and conditions of developing countries."