Qantas defers delivery of A380s Qantas is to boost capacity on its domestic routes and delay investment in new aircraft for its loss-making international operations in response to the encroachment of rival Virgin Australia on its market share. The Australian flag carrier on Friday said it would reduce capital expenditure a further A$400m, to A$1.9bn in the financial year to June 2013, by deferring delivery of two A380 super jumbos. The delivery of the Airbus aircraft, which had been scheduled for early 2013, will be pushed back to 2017. Qantas is due to receive six further A380s, which have a list price of $390m, in 2018/19. Qantas" delay is a further blow to Airbus, which has had to cut production of its flagship aircraft in order to address an embarrassing cracking problem in the wings. In effort to fend off Virgin and defend its "line in the sand" 65 per cent domestic market share, Qantas said it would add services on the "Golden Triangle" routes connecting Sydney, Melbourne and Brisbane, and reintroduce 747 jumbo jets on its Sydney-Perth route Virgin, which has a 30 per cent Australian market share, recently announced plans to introduce more wide-body aircraft with bigger and more luxurious business class cabins, as well as more frequent services on key business routes. This week the airline reported a 14.4 per cent increase in capacity for March. The increase in capacity has raised fears of a more aggressive pricing environment in Australia and analysts have in response lowered profit forecasts for both Qantas and Virgin. In a recent report, RBS estimated that by September the amount of capacity across the top 10 routes in Australia would be almost a fifth higher than a year ago. However, Alan Joyce, Qantas chief executive, said capacity increases and reintroduction of large planes would help the airline's "profit-maximising" of its domestic market share. "We have made substantial progress in our fleet renewal programme," he said. As a result we are in a good position to reduce capital expenditure, targeting investment at business areas that deliver sustainable returns. The A$400m decrease in capital expenditure for 2012/13 follows a A$500m cut in spending announced by Mr Joyce in February. Qantas has set a target of 2012 for returning its international business to profitability. It lost A$200m in the last financial year, . Mr Joyce said Qantas was beginning to quantify and realise costs savings from its international "transformation initiatives" and had identified more than A$300m of annual savings. He added that the airline, which faces fierce competition on its international routes from Asian and Middle East based competitors, would announce by the middle of the month which of its three heavy maintenance bases in Australia it will close. Mr Joyce declined to provide profit guidance due to a "high degree of volatility and uncertainty in global economic conditions."