Despite the recovery of its domestic operations, Qantas is still pursuing talks to open of a new Asia-based premium carrier.

Beyond confirming the existence of the talks, Qantas Chief Executive Alan Joyce declined to provide additional details as negotiations comtinue.

Joyce expressed hope that the ongoing labor dispute with three unions being handled by Fair Work Australia would not result in a decision that would not threaten the viability of Qantas's planned international expansion strategy. The unions oppose the expansion because of fear of losing jobs to offshoring and outsourcing.

The CEO told investors Monday that despite the labor conflict, Qantas would continue with cost-cutting and boosting productivity to battle competition, particularly from Middle Eastern and Chinese carriers.

Qantas previously talked to Malaysian Airlines and Air Asia since the national carrier had expressed preference to establish the planned regional hub in Kuala Lumpur. The airline had also talked to carriers in Singapore, which is next on its order of preference.

Although domestic bookings, including corporate accounts, have recovered well and are back to normal levels, international bookings are recovering at a slower pace to levels just before the industrial actions hit Qantas.

RELATED STORIES