Qantas will unveil fabulous profits at its half-year results today while it continues to prioritise its share price over customers, staff and fleet renewal. Michael Sainsbury reports.
A Qantas customer recently told this correspondent, “I was in the Qantas First Class Lounge in Los Angeles and ordered a hamburger but was told there were no buns”. It’s an apt reflection of the razzle-dazzle of the airline’s profits which are again enormous but built on the backs of screwing down workers’ wages, illegal out-sourcing, under-investment in its fleet and a decline in its onboard experience.
The cracks are becoming more evident. Pilots, engineers and other Qantas insiders who spoke to MWM said that management appeared “rudderless”: consumed with “providing band-aid solutions” as the airline tries to sit out a multi-year wait for new aircraft to improve both its performance, product and cost base.
After previous chief executive Alan Joyce cancelled plans for Boeing 787s in 2018, the company waited another five years to order new aircraft. Only a handful have arrived and most models are running late due to problems at Airbus and Boeing.
Five of the 29 A220s that have been delivered are suffering from a shortage of trained flight deck crew as well as well-documented engine and other operational problems.
Ageing aircraft
Qantas’ domestic and international fleets continue to deteriorate amid growing pressure from Virgin and international rivals with much newer aircraft and a better experience. And as its planes have struggled to stay in the air, with engines being a key problem, Qantas’ capacity has gone backwards. According to the ACCC’s February 2025 report on domestic airline competition in Australia, Qantas experienced a 4.7% decrease in seat capacity compared to December 2019.
Like cars and people, the older the aircraft, the more maintenance it requires. Qantas’ decision in recent decades to outsource an increasing amount of maintenance work to Los Angeles,Singapore, Bangkok, Manila, Abu Dhabi, and Dresden means that there are often long delays in getting its engines and planes fixed.
“There’s two ways of sensibly operating aircraft; the first one uses minimum and cheap and nasty maintenance and turns over aircraft fast with the associated leasing costs, etc being high,” a Qantas engineer told MWM.
“The second one is to amortise your fleet by operating them longer with lower leasing costs but high maintenance costs, which is required to keep those jets flying safely. That’s how Qantas used to operate, aircraft out of Heavy Maintenance were literally as good or better than new since we corrected all fuckups by Boeing.”
“This approach is very expensive, though, and no airline can afford it anymore due to the flying public expecting lower ticket prices.”
What Qantas seems to be attempting is to operate very old aircraft with cheap nasty maintenance: basically, combine the two profit maximising strategies.
“This isn’t going well,” MWM’s source concluded.
MWM has learned that Qantas’ long haul workhorse fleet of A330 aircraft, which have an average age of 20 years, is in a dire state. As of last Sunday, four of the aircraft were grounded, and several more have recently been out of service for up to two weeks.
A clear sign of the A330 troubles came earlier this week when Qantas suspended flights between Melbourne and Delhi between June and October 2025, saying the route was temporarily becoming a “seasonal” service. Qantas told travel agents that the cancellation was “due to some current fleet and operational requirements.”
Domestic capacity crisis
Some A330s were recently brought from international routes onto domestic legs to try and bolster capacity because of the growing problems with the ageing 737 fleet. An investigation by MWM showed that on Feb 24, six 737s were grounded, and at least six others were flying only part loads (5 hours or less).
Domestically, Qantas’ capacity crisis has allowed an airline that controls 63.6% of the market through its Qantas mainline, regional QantasLink and Jetstar to charge higher prices to offset fewer seats.
The company continues to cut domestic flights, and this week’s ACCC quarterly aviation report confirmed the airline’s capacity squeeze and domestic airfares rose 13.3% between June and September, and “average revenue per passenger spiked in October and November 2024.”
The state of the Qantas fleet is underscored in the latest figures from the Bureau of Infrastructure, Transport Research Economics (BITRE) show that Virgin has trounced Qantas two months running with cancellation rate of less than 1% of flights against more than 2% for Qantas, QantasLink and Jetstar.
Virgin Australia has outperformed the Qantas Group in recent months, showcasing improved reliability and punctuality across its network.
The Qantas Group has failed to match Virgin’s performance. In December 2024, Qantas recorded the highest cancellation rate at 2.7%, followed by Jetstar at 1.5%.. The trend continued into January 2025, with Qantas cancelling 2.8% of flights, QantasLink 2.1%, and Jetstar 2.3%.
On-time performance figures for January 2025 further highlight Virgin’s improvement.
On-time performance, January 2025
| Airline | On-time arrivals | On-time departures |
|---|---|---|
| Qantas Link | 77.9% | 78.3% |
| Virgin | 77.1% | 78.0% |
| Qantas | 72.3% | 71.6% |
| Jetstar | 69.7% | 66.8% |
While its grip on the domestic market means that poor fleet management and shrinking capacity actually work in its favour – although not for customers, it’s a different story internationally.
Qantas has effectively outsourced its European business to codeshare partner Emirates, only flying two flights a day to London. Last year, it added one four times a week from Perth to Paris (QF33), but this has unfolded as a disaster, with passenger loads often below 50%, according to Qantas internal data seen by MWM. QF33 was cancelled on Wednesday.
Insiders say management is mulling whether the route will either be pulled altogether or handed off to another “wet lease” similar to current Finnair aircraft and crews conducting QF flights between Australia and Singapore/Bangkok. Hudson said to be exploring more wet leases with Finnair to destinations like Japan andHonolulu as her international fleet shrinks and is redeployed.
The Limping Roo is also being bested on the once lucrative US route by United and Delta which have newer planes, vastly improved cabin service and growing frequency into Sydney, Melbourne and Brisbane – and fewer cancellations.
QF93 from Melbourne to Los Angeles did not fly Tuesday and Wednesday this week. Lucky passengers would have been flown to Sydney or Brisbane for their flights instead.
Hawaiian Airlines and Fiji Airways, along with Japanese and Korean airlines, are fiercely competitive in price and service.
Enter Qatar Airways
The latest blow to Qantas international business came in On Feb. 14 when the competition regulator handed draft approval to Virgin for its wet lease deal with Qatar Airways. This will see Virgin utilise Qatar’s state-of-the-art aircraft as well as staff and cabin service from an airline rated number one or number two in a range of recent airline surveys. Qantas unsuccessfully lobbied hard against the deal.
Hudson is at least said to be in the market for more engines for her B737 and A330s. She also has the option to bolster her fleet with younger, more reliable second-hand planes. China Southern Airlines recently put 10 Boeing 787s up for sale. But Hudson knows any such spending would immediately hit its share price – and executive bonuses.
Hefty profits notwithstanding, this sorry state of affairs for Qantas’ long-suffering passengers is the final crescendo of Alan Joyce’s private equity model.
Vanessa Hudson has now been in charge for18 months, and right now, her employees see no evidence of any plan to right the listing ship.
No buns, no engines, and no planes.
Michael Sainsbury is a former China correspondent who has lived and worked across North, Southeast and South Asia for 11 years. Now based in regional Australia, he has more than 25 years’ experience writing about business, politics and human rights in Australia and the Indo-Pacific. He has worked for News Corp, Fairfax, Nikkei and a range of independent media outlets and has won multiple awards in Australia and Asia for his reporting. He is a fierce believer in the importance of independent media.
