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Qantas shares dive as company shelves expansion plans

by April 18, 2016 General

SYDNEY, April 18 (Xinhua)– Qantas shares fell more than 10 percent on Monday as the company announced it would axe plans to add more flights to its schedule.

Qantas said it would remove three Sydney to Los Angeles services from its weekly schedule and redirect the services to Singapore and Hong Kong to meet the demand in that section of the market.

“Some softness in demand, related to the upcoming federal election and recent drop in consumer confidence in Australia, began to emerge over the peak Easter and school holiday period in late March and continued to be seen in forward bookings in April and May,” Qantas said in a statement on Monday.

“As a result of these changes, previous guidance for group domestic capacity growth of around 2 percent in the second half of the financial year has been revised to growth of between 0.5 percent and 1 percent,”they said.

The company also noted Qantas and Jetstar domestic capacity in March was 2.9 percent higher, with growth on the East Coast and leisure routes making up for the reduced capacity in the West Australian and Queensland resources markets.

Qantas shares lost as much as 14.29 percent in early morning trade.

At the close, Qantas shares fell 10.84 percent.