The Qantas Group has unveiled its long-term business strategy to revitalise the national carrier from recovery to growth. It is a blueprint that charts its course to 2030 and promises a customer-focused, sustainable, and technologically advanced future. The ambitious roadmap was presented at the Group’s first Investor Strategy Day since the COVID pandemic.

Alan Joyce, Qantas Group CEO, outlined a sweeping vision for the future of Australia’s leading airline. “This is a structurally different business than before COVID, operating in markets that have also changed. We’re very well placed to take advantage of the opportunities that creates, and the detail we’ve released today shows our strategy to do it,” he said.

A New Era for Customer Experience

At the heart of the strategy lies an emphasis on customer satisfaction by implementing advanced fleet innovations. The ‘right aircraft, right route’ approach will see next-generation aircraft such as A220, B787, and A320-family flying the airline’s network starting this year, providing passengers with new routes, increased comfort, quieter cabins, and reduced carbon emissions.

Further bolstering its customer-centric vision, Qantas plans to revamp its mobile app by the end of 2023, which will enhance customers’ control over bookings, introduce baggage tracking, and further integrate Qantas Loyalty. Frequent Flyers are set for a treat, with Qantas set to overhaul its boarding process in October 2023 and significantly expand its range of redemption options.

Jetstar, a subsidiary of Qantas, is also maintaining its commitment to affordable travel, with nearly 10 million fares under $100 available this year, alongside 5 million reward seats via Qantas Loyalty.

Sustainability: A $400M Commitment

In a landmark commitment to environmental responsibility, Qantas has announced a $400 million Climate Fund – the largest of its kind for any airline. The fund aims to drive progress towards the Group’s sustainability targets, focusing on stimulating Sustainable Aviation Fuel (SAF) production, high-integrity offsets, carbon removal technology, and technologies targeting efficiency and waste reduction.

Additionally, the Qantas Group urges the Australian Government to introduce a SAF blending mandate, similar to steps taken in other jurisdictions, including the UK, Europe, the US, and Japan, to stimulate local production.

Focus on People

Qantas’ long-term strategy also centres on its employees. The company has announced bonuses totalling approximately $11,500 in FY23-24 and plans to create up to 8,500 operational roles in Australia by 2033 to support new aircraft and additional flying.

The airline aims to restore its ‘employer-of-choice’ status as the industry recovers. The attrition rates have declined from 18 per cent in December 2021 to an average of 5 per cent across the group (to as low as 2 per cent for pilots).

Financial Roadmap

On the financial front, Qantas plans to maintain margins of 18 per cent for Qantas Domestic and 15 per cent for Jetstar Domestic from FY24 onwards. Qantas International margins are expected to grow from around 5 per cent pre-COVID to more than 8 per cent in FY24, rising to 10-12 per cent with Project Sunrise and the evolution of freight.

Qantas Loyalty is set to reach its FY24 EBIT target of $500m-$600m, increasing to $800m-$1,000m by FY30. The critical profit drivers will include an expanded presence in hotels and holidays, increased partnerships with major retailers, diversification in financial services, and growth of the existing Qantas Business Rewards program for SMEs.

Vanessa Hudson, Group CFO and CEO-designate affirmed the strategy: “We’re confident in reaching our FY24 margin targets, and we’ve set some ambitious but achievable earnings goals beyond that, because we think ambition is key to long-term performance. Our long-term focus remains delivering for customers, employees and shareholders, and ensuring a strong business generates strong returns is the best way to enable that.”

In the face of changing market conditions, Qantas’ strategy underlines a clear and progressive vision of growth, customer-centricity, sustainability, and innovative technology, reaffirming its commitment to excellence to its customers, employees, and shareholders.

Written by: Christine Nguyen

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