Qantas Airways said on Tuesday that long-serving CEO Alan Joyce would exit the company two months earlier than previously flagged as a reputational turbulence engulfs Australia's flagship carrier.

Joyce's early retirement will see CEO Designate Vanessa Hudson, the first woman to lead the century-old airline, take charge on Wednesday.

The accelerated departure comes after Qantas apologised for its service standards falling short and acknowledged it was suffering reputational damage, after Australia's competition regulator sued it for allegedly selling tickets for thousands of cancelled flights.

Joyce, who served as the airline's CEO for 15 years, said: "In the last few weeks, the focus on Qantas and events of the past make it clear to me that the company needs to move ahead with its renewal as a priority."

Last week, the Australian Competition and Consumer Commission (ACCC) said in a court filing that the carrier broke consumer law when it sold tickets to more than 8,000 flights between May and July 2022 without disclosing they had been cancelled.

"This transition comes at what is obviously a challenging time for Qantas and its people," Qantas Chairman Richard Goyder said of Joyce's early departure. "We have an important job to do in restoring the public's confidence in the kind of company we are, and that’s what the board is focused on, and what the management under Vanessa's leadership will do."

The carrier announced a raft of leadership changes in June in a bid to increase focus on key areas as the airline completes its post-pandemic recovery.

Last month, the carrier posted record annual earnings underpinned by a continued strong rebound in travel demand.

(Reporting by Aishwarya Nair in Bengaluru; Editing by Jamie Freed)