The Australian flag carrier will send home two-thirds of its 30,000-strong workforce, it announced on Thursday.
Qantas and its low-cost unit Jetstar will suspend all overseas flights from late March to at least the end of May.
It joins a growing list of airlines cancelling international flights as travel demand dries up globally.
“Demand has evaporated,” Qantas chief executive Alan Joyce said in a note to employees. “We have no work for most of our people. We have to make difficult decisions to guarantee the future of the national carrier.”
Ryanair, Europe’s biggest low-cost carrier, has warned it will ground almost all of its fleet from next Tuesday following widespread travel bans across Europe to help prevent the spread of the virus.
Once-popular routes are now seeing very few flights left running, with experts warning that they may dry up completely. Flights from Japan to Southeast Asia have been hit particularly hard as these are normally popular tourist routes.
“What we are seeing is unprecedented. Along with the safety issue, there is a huge disincentive to travel with confusion over quarantine and visa rules,” said Greg Waldron of Flight International magazine. “It’s theoretically possible we could see no international flights as demand is extremely low.”
Earlier this week, Austrian Airlines, part of German carrier Lufthansa, announced plans to temporarily suspend all flight operations. A large number of other airlines have announced similarly drastic measures to slash costs and preserve cash.
During the mass grounding of planes, the airline industry is appealing for government help with many carriers on the brink of collapse. “If you were not financially healthy going into the crisis, then you are very vulnerable now,” added Waldron.
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