Qantas Airways is axing at least 20% of its workforce and intends to raise up to A$1.9 billion ($1.3 billion) of equity under a sweeping cost-saving plan prompted by the coronavirus pandemic.

The 6,000 job cuts will come from across the airline’s 29,000-strong workforce. Around half will be non-operational and ground operations staff, with the remainder a mix of cabin crew, engineers and pilots.

A further 15,000 workers will remained furloughed until Qantas begins operating more flights. It has begun ramping up domestic flying as state borders reopen and expects to reach 40% of normal capacity in July, an average of around 70% next financial year and 100% in FY22.

The Australian airline also said on Thursday it will ground 100 aircraft for up to 12 months and retire its remaining Boeing Co 747 fleet immediately, six months ahead of schedule, given travel restrictions imposed by the global health crisis. “We have to position ourselves for several years when revenue will be much lower,” Qantas Chief Executive Alan Joyce said of the three-year plan. “And this means becoming a much smaller airline in the short term.”

Along with other airlines around the world, Qantas is battling against a huge drop in demand after countries including Australia closed their borders to try contain the pandemic.

Australian officials have said the country is likely to remain closed to the vast majority of international travellers until next year.

Joyce said Qantas was taking a “realistic” view that there would not be international operations of real scale until July 2021, with a proposed “travel bubble” between Australia and New Zealand a potential exception.

Reuters