Qantas plans to cut 850 Australian jobs as part of a multi-year technology and AI overhaul with Accenture, transferring some back-office services to Accenture’s team in India.

The changes target office-based corporate roles rather than flying or airport operations, with no expected flight or customer-service changes reported as part of the deal.

The restructuring is expected to begin in mid-2027, initially affecting employees in finance, procurement, human resources and marketing; Qantas CEO Vanessa Hudson acknowledged the uncertainty for staff and said the decision did not diminish their contributions.

The Australian Services Union said Qantas had previously indicated there were no plans to offshore Australian jobs, while Qantas disputed that account and said the possibility of transferring roles had been discussed with union representatives.

Transport Minister Catherine King called the move “incredibly disappointing,” questioned why AI-related work needed to go overseas and urged Qantas to work with unions on retraining and redeployment.

Union representatives Angus McFarland and Scott Cowen warned that the cuts could put Australian jobs and skills at risk, and called for worker protections as AI reshapes workplaces.

The announcement revives scrutiny of Qantas’s outsourcing record: the airline received $2.7 billion in taxpayer support during COVID before outsourcing 1,800 ground-crew jobs, a move ruled illegal that brought fines and reputational damage.

The deal comes amid pressure from rising fuel costs and possible fare increases, with anticipated long-term savings weighed against near-term restructuring costs and workflow disruption; Qantas has not disclosed the partnership’s value or expected savings.

Fuel costs have also weighed on Qantas’s finances: jet fuel expenses reduced annual profit by $420 million after exceeding budget by $610 million, and the airline cancelled a planned $150 million share buyback while warning fares could rise in 2027.

The airline has also cancelled its Adelaide–Mount Gambier route indefinitely and announced suspensions affecting Melbourne–Alice Springs, Melbourne–Hamilton Island and Melbourne–Coffs Harbour, citing high fuel costs and weak demand.

The changes reflect broader pressures on tourism, including higher fuel, wage, insurance and airport costs and ongoing staff shortages; Qantas reported almost $1.3 billion in full-year profits in August, down 19.7 per cent from the previous year.

The wider challenge for tourism is balancing efficiency and modernisation with jobs, affordable travel, viable businesses and access to destinations as the sector rebuilds from the pandemic.