The international business of Qantas Airways is at an "inflection point" and could return to profitability once again after a series of cost-cutting measures and the signing of a wide-ranging agreement with Emirates.
The alternative to these moves is "decline", says Qantas chief executive Alan Joyce. Measures such as the consolidation of the carrier's Australian maintenance depots and the deferral or cancellation of new aircraft orders would have affected the profitable parts of Qantas such as its domestic business and frequent flyer programme.
"Qantas International has been contracting for some time. Further contraction would have a very serious domino effect on the rest of the business," he adds in a speech to the National Press Club in Australia.
The 10-year partnership with Emirates, which is being scrutinised by Australian regulators, means that Qantas will increase its services to Dubai and make it the hub for destinations in Europe, the Middle East and North Africa via the Emirates network, says Joyce.
It will complement the other Qantas global hubs. These include Los Angeles and Dallas for North America, Santiago for South America, Johannesburg for South Africa, and Singapore and Hong Kong for Asia.
"Emirates is a true peer airline for Qantas. It is one of the world's biggest carriers, with an all widebody fleet and excellent product and service standards. If it is approved, this partnership will allow us to deliver customers a seamless Australian and international network, extensive frequent flyer benefits and consistently excellent travel experiences," says Joyce.
"This partnership will extend our airline's reach, while restraining our costs. Dubai will become a one-stop gateway to 33 destinations in Europe and 28 in the Middle East or North Africa."