Qantas CEO Alan Joyce will refuse a salary until July as the carrier struggles to shake off the financial implications of coronavirus.
SEA OF RED: $155bn wiped from Australian share market
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In addition to temporarily culling one quarter of its flights, Joyce will take no salary while the chairman will take no fees.
Joyce last year took home $23.8 million, making him Australia’s highest-paid CEO, according to the Australian Council of Superannuation Investors.
Additionally, the board will take a 30 per cent reduction in fees and staff have been asked to take paid or unpaid leave.
“Less flying means less work for our people, but we know coronavirus will pass and we want to avoid job losses wherever possible,” Joyce said on Tuesday.
“We’re asking our people to use their paid leave and, if they can, consider taking some unpaid leave given we’re flying a lot less.
“Annual management bonuses have been set to zero and the group executive team will take a significant pay cut for the rest of this financial year.”
Joyce said the airline has seen a “sharp drop in bookings” on its international network and expects to see continued lower demand.
Demand for Asia travel has plummeted 31 per cent, while US travel has fallen 19 per cent. Travel to the UK is down 17 per cent and Trans-Tasman travel has also fallen 10 per cent.
“So rather than taking a piecemeal approach, we’re cutting capacity out to mid-September. This improves our ability to reduce costs as well as giving more certainty to the market, customers and our people.”
Qantas said it will also cancel an off-market buyback announced in February which will preserve $150 million in cash.
Qantas shares drop
Qantas shares crashed on Monday, down 10.94 per cent to $4.15. In December, the Qantas share price was $7.40.
That drop came as the entire ASX suffered its worst day since the GFC on Monday, shedding $155 billion, sinking 7.33 per cent off the back of an oil price war also triggered by coronavirus.
Air NZ CEO also refuses salary
Joyce’s pledge comes after the Air New Zealand CEO Greg Foran said he would cut his pay by 15 per cent in the face of coronavirus, or Covid-19.
Foran said he would shave $250,000 off his base pay of $1.65 million.
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