Qantas confident in $400m boost from ultra-long haul flights

The airline is confident it can boost its earnings by hundreds of millions with two new flight routes set to be popular among travellers.

Qantas is predicting changes to its fleet and ultra-long haul flights will drive a whopping $400m in earnings when the planes finally hit the sky.

The national carrier is on track to hit a record profit of $2.48 billion for the latest financial year – almost $1 billion higher than pre-Covid profits.

Highly-anticipated long-haul flights between Australia, Europe and North America - known as Project Sunrise - are expected to drive a “significant incremental” increase to earnings.

Another factor is the twelve Airbus A350-1000 aircraft that were ordered specifically to deliver the direct route services to London and New York.

Future Qantas CEO Vanessa Hudson is confident the airline can meet ambitious targets as airline forecasts $400m earnings before tax. Picture: NCA Newswire / Gaye Gerard

“[Project Sunrise] is expected to deliver significant incremental earnings increases, reaching an estimated $400+ million EBIT per annum in the first full year of having all 12 aircraft in service,” Qantas said in a statement outlining their 2030 strategy.

Inaugural flights are scheduled to takeoff in late 2025 and will cut down point-to-travel time by up to four hours compared to routes with one stop.

Qantas Group chief executive Alan Joyce said updates to the airline’s long-term strategy is proof of the business’ transformation since the pandemic.

Project Sunrise is not set to takeoff until 2025 and the earnings are forecast to be delivered a full year after the fleet is flying. Picture: NCA NewsWire / Ian Currie

“This is a structurally different business than it was before Covid, operating in markets that have also changed,” he said.

Arrivals of next-generation aircraft are central to the airline’s plan to adapt to industry changes.

“New technology is central to our plan and the next-generation aircraft that have started arriving will transform our network over the next few years,” he said.

“We’ll be able to serve our customers better, reduce our cost base through lower running costs and carve out some new competitive advantages.”

Qantas CEO Alan Joyce will step down after 15 years at the helm. Picture: NCA Newswire / Gaye Gerard

Qantas chief financial officer and incoming chief executive Vanessa Hudson said the strategy shows the airline is making “ambitious but achievable goals”.

“We’re confident in reaching our FY24 margin targets and we’ve set some ambitious but achievable earnings goals beyond that, because we think ambition is key to long-term performance, she said.

Ms Hudson also indicated decarbonisation of the fleet will form part of Qantas’ focus moving forward but said the long-term focus was on ensuring the strength of the business.

“We’re determined to be a leader in this space and that’s supported by the new commitments we’ve made today, as well as calling for more action industry-wide in the form of a sustainable aviation fuel mandate,” she said.

“Our long-term focus remains delivering for customers, employees and shareholders, and making sure we have a strong business that generates strong returns is the best way to enable that.”

Originally published as Qantas confident in $400m boost from ultra-long haul flights