AviationQantas may have to fork out $226 million for sale of cancelled flights and Covid refunds.

Qantas flies into a storm over conduct

Qantas accused of deceptive conduct by selling tickets for thousands of already-cancelled flights in 2022.
Qantas accused of deceptive conduct by selling tickets for thousands of already-cancelled flights in 2022. Photo Credit: Adobe Stock/Brastock Images

A week after announcing a A$2.47 billion (US$1.6bn) pre-tax profit for the 2022-23 financial year, Qantas is facing a series of challenges that is testing the loyalty of its customers and the resilience of its brand.

Foremost among these challenges is an allegation by Australia’s consumer watchdog, The Australian Competition and Consumer Commission (ACCC) that the national carrier had “engaged in false, misleading or deceptive conduct” by selling tickets for more than 8000 already-cancelled flights between May and July last year”.

The ACCC alleges that for about 70% of cancelled flights, Qantas either continued to sell tickets for the flight on its website for two days or more, or delayed informing existing ticketholders that their flight was cancelled for two days or more, or both.

The ACCC is seeking to penalise the airline with fines of more than A$250 million (US$161.7m).

Qantas is also at the centre of a row over the Australian government’s move to block an application by Qatar Airways to add 21 weekly flights into Sydney, Melbourne and Brisbane.

The government insisted its refusal was in the “national interest” without explaining how they arrived at the decision. Some have questioned whether Qantas influenced the government’s decision-making.

In response, the travel industry in Australia has united in opposing the government’s stance on the Qatar flights, arguing that allowing the Middle Eastern airline to increase its flights would help to reduce the current high cost of airfares, and drive more tourists into Australia.

Australian biggest travel agency, Flight Centre is urging the government to allow the extra flights in a series of full-page print advertisements. Others backing Qatar include the Council of Australian Tour Operators (CATO), the Queensland state government and Virgin Australia, a partner of Qatar Airways.

Compounding what has been a reputation-damaging few days for Qantas, last week a parliamentary hearing revealed Qantas owed A$100 million more in Covid flight refunds than was previously thought – forcing the airline backflip on its December 2023 refund expiry announcement.

In a statement on Monday, Qantas conceded the ACCC’s allegations “come at a time when Qantas’s reputation has already been hit hard on several fronts”.

“We openly acknowledge that our service standards fell well short, and we sincerely apologise. We have worked hard to fix them since and that work continues,” the statement continued. “We know it will take time to repair. And we are absolutely determined to do that.”

Qantas chief executive Alan Joyce is due to step down in November. Last week he was granted A$10.8 million (US$7 million) in shares for bonuses deferred during the pandemic.

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