News
Qantas and American re-submit trans-Pacific application
March 2nd 2018
Qantas Airways and oneworld alliance partner, American Airlines, this week resubmitted their application for renewal of their trans-Pacific joint venture (JV) to the U.S. Department of Transportation (DoT). Read More »
The DoT tentatively rejected their application in November 2016, agreeing with Hawaiian Airlines that approval would give the carriers undesired dominance in the U.S.-Australasia market.
In this week’s resubmission, Qantas and American suggested the extension of their partnership could stimulate up to 180,000 new passengers on new routes between the U.S., Asia, Australia and New Zealand, in addition to US$310 million of “quality of service benefits”, including improved connections and lower fares.
American said that if the JV was rejected again, it would have “no choice” but to further reduce its codesharing partnership with Qantas. Since the DoT’s first rejection in 2016, the two carriers have reduced their codesharing routes from more than 100 weekly frequencies to approximately 70.
“American has been forced to downgrade its service to Australia and New Zealand, and the parties have stopped codesharing on flights between the United States and Sydney,” the oneworld partners said in their reapplication.
The airlines further argued that Qantas may be forced to end or at least curtail its daily Sydney-Dallas A380 operations should their application be refused.
“These routes rely on codeshare support from each airline’s feeder network via their respective hub cities to be economically viable,” the carriers said.
The Qantas Group last week delivered its highest-ever first-half underlying profit before tax of A$976 million (US$754 million) for the six months ending December 31.
The result surpassed the previous record of A$921 million achieved in the first half of FY16 and came despite recent increases in fuel costs and continued international capacity growth. Both underlying and statutory profit before tax were significantly higher (15% and 20%, respectively) than the first half of FY17.
