[SYDNEY] Qantas Airways is axing 15 per cent of its workforce, slashing spending and selling oil-guzzling older planes after stiff competition at home and overseas pushed the Australian flag carrier deep into the red in the first half.

In the most radical surgery at the airline since it was privatised two decades ago, Qantas plans to cut costs by A$2 billion (S$2.26 billion) over the next three years.

It hopes the shake-up will convince the Australian government that Qantas is worthy of the state assistance it says it desperately needs.