Virgin Australia flags possibility of more job cuts, reductions

Australia’s second-largest airline has revealed would drastically cut flights, freeze some spending and ask staff to take leave.

VIRGIN Australia Group has flagged the possibility of further job cuts and cost-reduction measures as it appeals for government support to manage the escalating coronavirus crisis.

Australia’s second-largest airline has revealed would drastically cut flights, freeze some spending and ask staff to take leave as it responds to the growing crisis that has resulted in one of its cabin crew members being diagnosed with coronavirus.

Virgin Australia refused to disclose the gender, age or location of the staff member due to privacy reasons.

Company CEO Paul Scurrah confirmed spoke with the female cabin crew member, who was “in good spirits and is in isolation as we speak”.

Virgin will double a planned capacity reduction, from 3 per cent to 6 per cent in the second half of this year, increasing to 7.7 per cent between July and December.

The coronavirus has crippled the global travel industry.

International routes to Los Angeles, Japan, and Trans-Tasman services will be reduced.

Virgin’s Brisbane to Tokyo Haneda service will launch on March 29, but fly only three times per week instead of daily.

Staff will be asked to take accrued annual leave or unpaid leave, or reduce working hours.

Director fees to the chairman and independent board director will be reduced by 15 per cent and management bonuses have been dropped.

The measures come just two weeks after Virgin announced it would cut Tigerair routes, jobs and network capacity after recording a $99.9 million loss in the first half of the financial year, and several days after Qantas revealed its fleet capacity would be cut by 25 per cent.

Virgin Australia CEO Paul Scurrah. (AAP Image/Dan Peled)

Virgin Australia executives are meeting daily to assess the company’s response to the virus.

“What we’ve announced today are sensible and disciplined measures,” Mr Scurrah said.

“This is an unpredictable circumstance.

“We’ve moved very quickly on a number of measures to help protect the group’s financial position.”

Despite the fleet capacity reduction Mr Scurrah said the company would not be grounding any aircraft.

He did not rule out further staff redundancies and cost-cutting measures in response to the evolving situation.

“There’s plenty to go through before we get to that point,” he added.

Guests with new or existing international bookings through to June 30 have the option to change their flight to a later date or to a different destination without incurring any change fees.

Guests with changes to their bookings will be contacted directly with alternative travel arrangements, including refunds for any routes that the group is no longer flying.

The coronavirus has created a price war in the travel industry, with domestic and international airfares among the lowest they’ve ever been.

Travellers can snap-up a return Brisbane to Los Angeles ticket from $886 and to London return from $1114 through Flight Centre.

Flight Centre said travellers should consider low-risk destinations such as Australia and the South Pacific.