Qantas says international travel will remain "at a virtual standstill" until at least the middle of 2021, apart from the prospects of flights to New Zealand under a trans-Tasman bubble.
While allowing that this could change depending on the speed of vaccine rollout, the airline's current assumption is one of "no material international travel until at least the end of June 2021" beyond NZ.
The domestic front presents a brighter outlook with states reopening their borders, with combined Qantas and Jetstar capacity now standing at 68% of pre-Covid levels for December and a target of 80% by March 2021.
"Overall, we’re optimistic about the recovery but we’re also cautious given the various unknowns," noted Qantas Group CEO Alan Joyce in a market update this morning.
"There’s been a rush of bookings as each border restriction lifted, showing that there’s plenty of latent travel demand across both leisure and business sectors."
"We’re also seeing people booking several months in advance, which reflects more confidence than we’ve seen for some time."
However, Joyce warned that "it's unclear what shape the domestic economy will be in next year, particularly once broader government support winds back. Until a vaccine is rolled out, the risk of more outbreaks remains."
On the financial front, the airline expects to post "a substantial statutory loss" for the 2021 financial year once June 2021 rolls around, although it will hit break-even point and move into "recovery mode".
But the road to recovery will be a long one, Joyce said.
International travel – which is typically worth over $8 billion in annual revenue – "will take years to fully recover, which means we’re carrying the overhead for billions of dollars worth of aircraft in the meantime."
"We’re also facing a revenue drop of at least $11 billion this financial year alone compared to pre-Covid," Joyce said.
"We also have a lot of repair work to do on our balance sheet from the extra debt we’ve taken on to get through the past nine months.
“That’s why we remain focused on delivering on our recovery program, which unfortunately involves following through on some hard decisions to restructure and respond to the new set of circumstances we’re faced with."