Qantas pleads for emergency intervention

Virgin Australia and Qantas battle for Australia

Qantas Airways has taken the step of asking for Australian government support after shocking investors with a profit warning, the news agency Reuters reports. Further job cuts and cost cuts are also likely.

Chief executive Alan Joyce said he called a number of government ministers to seek urgent action, complaining that rival Virgin Australia’s access to foreign funding has resulted in unfair competition.

In the latest confrontation between the two airlines in recent months, Qantas said in a statement that Virgin Australia “should not have the benefits conferred by an Australian carrier designation when it has only 20% Australian ownership.”

Qantas warned investors that it expects an underlying pre-tax first-half loss for the first time ever. Emergency action could come in the form of a share purchase or ownership of Qantas’ loss-making international division.

Reuters

[pictured: Qantas A380; courtesy Qantas]


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