Why is the Qantas share price having such a strong start to the week?

When the global pandemic struck in early 2020, Qantas found almost its entire fleet grounded and its share price smashed.

| More on:
A woman looks up at a plane flying in the sky with arms outstretched as the Flight Centre share price surges

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The Qantas share price is lifting off on Monday morning
  • The ASX 200 airline reported that the last of its A380 double decker aircraft has finally emerged from years of COVID storage
  • The planes undergo extensive maintenance and servicing, with many parts fully replaced, before returning to service

The Qantas Airways Ltd (ASX: QAN) share price is flying high in Monday morning trade.

Shares in the S&P/ASX 200 Index (ASX: XJO) airline stock closed on Friday trading for $6.50. Shares are currently trading for $6.65, up 2.3%.

The Qantas share price is outperforming today amid news that the last of Qantas' "incredibly popular aircraft" for long-haul flights is finally emerging from years of COVID storage.

What's happening with the airline's long-haul fleet?

When the pandemic struck in early 2020, domestic and international borders slammed shut. And Qantas found almost its entire fleet grounded and its share price smashed.

The airline was forced to make the difficult decision to temporarily mothball 12 of its double-decker A380 aeroplanes in the desert of Victorville, California. Two were eventually broken up for parts, leaving the other 10 waiting for travel demand to return.

Last year that travel demand returned with a vengeance, throwing up some helpful tailwinds for the Qantas share price.

But only now, almost 1,000 days after grounding in Victorville, is the last of those long-haul aircraft leaving storage. Like the others, it will undergo extensive maintenance and servicing, with many parts to be fully replaced, before returning to service.

Qantas' executive manager of engineering Scott McConnell, quoted by The Australian, called it the "biggest engineering challenge" the company has faced, with the operation taking some 4,000 man hours to complete.

"While the conditions in the Mojave Desert were good for safely storing aircraft, they did create some unique challenges for our engineers," he said. "They worked through storms and snow, extreme heat, and there was lots of very fine dust around."

Commenting on the extensive work required before the last A380 can return to service, McConnell added:

The aircraft also has a number of items on board that have an expiry date, like the escape slides, fire extinguishers and oxygen bottles, so they all had to be replaced. All of the systems were checked, some of these tests taking many days to complete…

It was a massive effort from a dedicated team of people.

With international travel continuing to tick up, McConnel said passengers would welcome the return of the A380s.

"They are an incredibly popular aircraft, and we know that people do seek them out for long haul flying," he said.

Qantas now has seven A380s back in regular service. The other three are scheduled to begin flying passengers in 2024.

Qantas share price snapshot

As you can see on the chart below, the Qantas share price has been a strong outperformer over the past 12 months, up 23%.

Investors who managed to snap up shares during the recent lows on 12 July will now be sitting on gains of 57%.

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Travel Shares

Couple at an airport waiting for their flight.
Travel Shares

Why is the Qantas share price crashing 10% today?

The Flying Kangaroo's shares are taking a big hit on Tuesday.

Read more »

Woman on a tablet waiting in for her flight in an airport and looking through a window.
Travel Shares

Why this fundie is sizing down its position in Qantas shares

It sees opportunities elsewhere in the global aviation sector.

Read more »

Smiling woman looking through a plane window.
Travel Shares

What's in store for Qantas stock after its first dividend in 6 years?

This will be the first payment since 2018/19.

Read more »

A woman reaches her arms to the sky as a plane flies overhead at sunset.
Travel Shares

Is now the perfect time to buy Qantas shares?

Let's see if analysts think this high-flying stock can keep rising.

Read more »

Man sitting in a plane looking through a window and working on a laptop.
Travel Shares

Are Qantas shares still worth buying at $10?

Qantas' rise in recent months has been extraordinary.

Read more »

A woman reaches her arms to the sky as a plane flies overhead at sunset.
Travel Shares

Own Qantas shares? Here's some big news

Here’s how the airline is planning to reward shareholders.

Read more »

Two adults and a child look happy as they walk through airport with child sitting on suitcase.
Travel Shares

Qantas dividend returns as shares near record high

The Flying Kangaroo's shareholders are smiling on Thursday.

Read more »

airline pilot on the phone looking distraught, qantas share price
Earnings Results

Why did the Flight Centre share price just crash 14%?

Flight Centre shares are under heavy selling pressure today. But why?

Read more »