Qantas to Close Regional Bases Impacting Staff and Service Reliability

Introduction

The recent announcement by Qantas to close its regional staff bases in Canberra, Hobart, and Mildura has become a focal point for debates about corporate responsibility, workforce management, and the future of regional aviation in Australia. Affecting approximately 70 employees, this decision has drawn sharp criticism from unions, politicians, and local communities, especially as it comes on the heels of Qantas reporting near-record profits of $2.39 billion AUD for the fiscal year ending June 2025.

The closures, scheduled for completion by April 2026, are not isolated events. They occur within a broader context of industry instability, including the collapses of Rex Airlines and Bonza Aviation, and follow a period of legal and reputational challenges for Qantas. This article examines the operational rationale behind the closures, their human impact, the industrial relations climate, and the broader implications for Australia’s aviation sector.

By analyzing official statements, union responses, and market data, we aim to provide a balanced, fact-based overview of this significant development and its potential effects on regional connectivity, workforce stability, and the competitive landscape of Australian aviation.

Corporate Decision-Making and Operational Restructuring

In late 2024, QantasLink, the regional subsidiary of Qantas, announced a review of its “base footprint.” The outcome was the decision to consolidate operations from Canberra, Hobart, and Mildura into larger metropolitan hubs: Sydney, Melbourne, and Brisbane. The company cited operational efficiency and scheduling flexibility as key drivers, asserting that the move would help maintain reliable service delivery as dozens of new Commercial-Aircraft join the fleet in coming years.

QantasLink CEO Rachel Yangoyan stated that the motive was not cost-cutting, but rather to “enable us to deliver a more reliable service for our customers.” The consolidation is expected to help the company better manage crew rotations and respond to operational disruptions, such as weather events or delays, which can currently strand crew in regional bases and cause cascading cancellations.

However, critics, including unions and some industry observers, argue that removing locally based crews may reduce service reliability in affected regions. Without on-site staff, any disruption could lead to higher cancellation rates for flights originating from Canberra, Hobart, or Mildura. Thus, while Qantas maintains that all existing services to these cities will continue, questions remain about the long-term impact on regional service quality.

“Consolidating our crew bases so we have more of our pilots and cabin crew flying out of our major Airports will enable us to deliver a more reliable service for our customers.”, Rachel Yangoyan, QantasLink CEO

Financial Performance and Legal Context

Qantas’ decision comes during a period of robust financial performance. The airline reported an underlying profit before tax of $2.39 billion AUD for fiscal 2025, a 15% increase from the prior year. Total revenue reached $23.8 billion AUD, driven by strong post-pandemic demand and successful pricing strategies. This profitability has led some critics to question the necessity of workforce reductions and base closures, especially given the company’s healthy balance sheet.

At the same time, Qantas is still recovering from a series of legal and reputational challenges. Most notably, the Federal Court imposed a record $90 million AUD penalty for the illegal outsourcing of 1,820 ground workers during the COVID-19 pandemic. The court found that the decision was made to prevent workers from exercising their rights, with labor savings initially calculated at $125 million AUD, though actual net savings were likely closer to $20 million AUD.

These legal issues have fueled union claims that the company prioritizes profits over people, and that recent actions are part of a broader pattern of workforce rationalization at the expense of employee welfare.

Human Impact and Workforce Displacement

The closure of the Canberra, Hobart, and Mildura bases directly affects about 70 pilots and cabin crew. Many of these employees have established deep roots in their communities, with some having previously relocated following earlier Qantas base closures in Perth and Cairns in 2020. The disruption extends beyond the employees themselves, impacting families, children’s education, and spouses’ employment.

A survey conducted by the Transport Workers’ Union (TWU), Australian Federation of Air Pilots (AFAP), and Australian and International Pilots Association (AIPA) found that 68% of affected pilots would consider leaving Qantas if forced to relocate. One in five had already experienced displacement due to previous closures, highlighting the cumulative toll of ongoing restructuring.

Qantas has offered a support package that includes financial assistance for commuting or relocation, covering flights and accommodation for those who choose to commute rather than move. While this may soften the immediate impact, unions argue it does not address the deeper disruption to family life and community ties.

“Qantas continues to put exorbitant profits over people, forcing employees into an untenable position where they must choose between family stability and career advancement.”, Emily McMillan, TWU National Assistant Secretary

Union Opposition and Industrial Relations

The Transport Workers’ Union has been particularly vocal in its opposition, framing the closures as evidence of Qantas’ indifference to worker welfare. TWU National Secretary Michael Kaine has accused the airline of failing to deliver on promises of cultural change, especially in light of the recent legal penalty for illegal outsourcing.

The union has linked the closures to broader challenges in regional Australia, citing the recent collapses of Rex Airlines and Bonza Aviation as part of a pattern of declining service and employment opportunities. The TWU has called for a “Safe and Secure Skies Commission” to ensure aviation decisions reflect the interests of all stakeholders, not just shareholders.

These industrial relations tensions are compounded by concerns about the cumulative impact of multiple restructuring waves, which have left many workers feeling insecure and undervalued, even as the company reports record profits.

Industry Context: Competition, Regulation, and Regional Connectivity

The Qantas base closures are occurring in a rapidly changing industry landscape. The recent administration of Rex Airlines and the collapse of Bonza Aviation have reduced competition on many regional routes, restoring the Qantas-Virgin Australia duopoly on most domestic city pairs.

According to the Australian Competition and Consumer Commission (ACCC), Qantas holds a 34.6% market share, with Jetstar at 29% and Virgin Australia at 35%. Rex now accounts for just 1.4% of domestic passengers, primarily serving regional and remote communities. The ACCC has raised concerns that reduced competition could lead to higher fares and less reliable service for consumers.

The federal government has responded by guaranteeing regional flight bookings for Rex customers during its administration, but broader policy interventions have focused on workforce development and training rather than direct Regulations of airline restructuring decisions. The government’s Aviation White Paper highlights critical shortages of pilots and maintenance engineers, challenges that may be exacerbated by workforce displacement resulting from base closures.

Service Quality and Operational Performance

Qantas maintains that all existing flights to Canberra, Hobart, and Mildura will continue despite the closures. However, industry analysts warn that the lack of locally based crews could make it harder to recover from operational disruptions, potentially increasing cancellation rates and reducing schedule reliability.

The ACCC’s monitoring shows that cancellation rates across the industry remain above pre-pandemic levels, and high load factors on major routes limit operational flexibility. In November 2024, load factors reached 90.4%, compared to a 12-month average of 82.9%. This environment makes any reduction in crew availability or flexibility a potential risk to service quality.

Community and business leaders in the affected cities have also expressed concern about the loss of well-paid aviation jobs and the broader economic impact of Qantas’ retreat from regional engagement.

“Passengers and freight service quality will inevitably be affected. The Flying Kangaroo doesn’t regard Hobart as an Australian capital city.”, Andrew Wilkie, Tasmanian Independent MP

Executive Compensation and Corporate Governance

The timing of the base closures has intensified scrutiny of Qantas’ executive compensation practices. Former CEO Alan Joyce received a $3.8 million AUD payout in share rights, while current CEO Vanessa Hudson’s total pay rose by 44% to $6.3 million AUD for fiscal 2025. These increases have fueled public and political criticism, especially in light of workforce reductions and ongoing legal disputes.

A corporate governance review commissioned after previous controversies found a “command and control” management culture at Qantas, with insufficient balance between stakeholder interests. The persistence of such issues, despite management claims of reform, underscores the challenges facing the company as it seeks to rebuild trust with employees, customers, and the broader public.

Conclusion

The Qantas base closures in Canberra, Hobart, and Mildura highlight the complex interplay between operational efficiency, workforce welfare, and regional service provision in Australia’s aviation sector. While the company’s financial performance remains strong, the human and community costs of consolidation have sparked widespread debate about the role of corporate responsibility in essential service industries.

As the industry continues to navigate workforce shortages, competitive pressures, and regulatory scrutiny, the need for more collaborative approaches to balancing commercial Sustainability with social responsibility becomes increasingly clear. The outcome of the Qantas restructuring, and the broader response from policymakers, unions, and communities, will shape the future trajectory of regional aviation and set important precedents for corporate governance in Australia.

FAQ

Why is Qantas closing its regional bases?
Qantas states that consolidating crew operations into major metropolitan hubs will improve operational efficiency and schedule reliability. The company argues this will help manage disruptions more effectively and support future fleet expansion.

How many employees are affected by the closures?
Approximately 70 pilots and cabin crew based in Canberra, Hobart, and Mildura will be required to relocate or commute to Sydney, Melbourne, or Brisbane by April 2026.

Will flights to Canberra, Hobart, and Mildura be cancelled?
Qantas has stated that all existing flights to these cities will continue. However, some analysts and community leaders are concerned about potential impacts on service reliability due to the absence of locally based crews.

What support is Qantas offering to affected staff?
The airline has offered financial support for commuting or relocation, including covering flights and accommodation for those who choose to commute instead of relocating.

How have unions responded to the closures?
Unions have strongly opposed the decision, arguing it prioritizes profits over people and undermines regional communities. They have called for greater oversight of airline restructuring decisions.

Sources

• news.com.au