Qantas is grounding five domestic jets (four 737s and one 767) from Monday, effectively cancelling 97 flights a week in a move its group CEO Alan Joyce says will allow it to maintain schedule reliability across the rest of its network.

In a hardening of the management resistance to protected industrial action by pilots, licensed engineers and ground staff, Joyce said the groundings would last for at least a month and the jets would be joined by others if the disputes deteriorated.

He said the groundings reflected the loss of 1200 hours a week of work by its licensed aircraft engineers required to keep the fleet airworthy.

Joyce confirmed that the restructuring announced by Qantas in August — in which resources would be diverted into a new minority-owned, high-quality, single-aisle airline based in Asia — had been narrowed to “excellent opportunities” in Kuala Lumpur and Singapore, but that negotiations with potential partners and the respective governments and authorities were complex, lengthy and it wasn’t yet possible to provide more guidance about where, how and when this investment would take off.

With the gap between labor and management appearing to be as deep and wide as ever, travellers need to adjust to doubts over getting seats on Qantas in coming months and the reality that Virgin Australia has no interest or capability in terms of rapidly expanding its capacity. Its flights are already heavily booked.

For business and leisure travellers, the prospect in coming months, unless there is a breakthrough, is Qantas/Jetstar or the highway.

However, on international routes Qantas has continued to pursue a deliberate downsizing of what Joyce says in an unsustainable loss-making operation, and more than 80% of Australians flying long-haul routes abroad have already defected to the likes of Singapore Airlines, Emirates, Cathay Pacific and Thai International.

Joyce faced the media this morning at almost the same moment the ACCC announced its intention to approve a network integration between Singapore Airlines and Virgin Australia that exploits the Qantas aversion to competing on long-haul routes and puts more pressure on its declared strategy of investing in peripheral offshore entities.

Further developments are expected later today and our coverage will be updated on Crikey blog Plane Talking.

Peter Fray

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