Thurs "The Australian"
Airline slashes services
By Jason Gregory
April 24, 2003
AUSTRALIAN Airlines has cut flights and encouraged staff to take holidays after the SARS crisis cut bookings by 60 per cent during the past week.
It emerged yesterday that the severe acute respiratory syndrome crisis, which has caused massive damage to some Asian carriers, including Hong Kong-based Cathay Pacific, also had hit Cairns-based Australian Airlines.
Airline chief executive Denis Adams said the carrier had slashed services to Hong Kong, suspended all flights to Taipei and amalgamated their Osaka and Fukuoka services because of "external forces beyond our wildest imagination".
The airline, which began in Cairns on October 27 last year, has gone into damage control with the temporary cutbacks since last week when fewer leisure passengers from Asia were detected.
The carrier is principally an inbound airline and relies on the inbound leisure market for up to 90 per cent of its business.
"We began to have very ordinary numbers all through last week and the bookings are dropping away quickly," Mr Adams said.
"Through watching what was happening with the other airlines we were expecting a setback, but perhaps not this big. As we were leisure market-orientated, we were probably insulated early on."
Most aircraft operated by the airline are flying half as many trips.
Mr Adams, who yesterday met graduating staff in Cairns after they completed a 5½ week training program, said there would be no reduction in employee numbers.
However some staff would take leave and others would be moved from flying to training courses in coming months.
Mr Adams said the airline was on a growth path and was adding destinations, including Sydney and Bali, in July.
Airlines with core Asian business also have been hammered in the past four weeks as a consequence of SARS with Cathay Pacific reporting to the Hong Kong Stock Exchange the airline could report heavy losses from the virus.
Qantas Airways has been forced to slash 1400 staff and Japan Airlines has cancelled some services to and from the region.
Air New Zealand yesterday announced further SARS-related cancellations to some routes during May and June.
It also warned that the current world airline industry environment "clearly remains extremely volatile".
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