Qantas ready for US expansion if joint venture approved

June 03, 2019
American flights
LA-Sydney flights suspended until May 6. Image: Qantas.

Qantas says it will move to expand its presence in the US if reports its joint venture agreement with American Airlines is about to get a green light prove correct.

Reuters reported recently that the long-delayed joint business agreement was poised to receive tentative Department of Transportation approval.

The original application by the airlines for anti-trust immunity foundered in 2016 when the Department of Transportation issued a tentative show cause notice that proposed to reject it.

The department concluded at that time that the proposal would substantially reduce competition and consumer choice without producing counterbalancing benefits.

READ: Qantas plans inflight exercise zone as crunch time approaches for Project Sunrise.

Qantas and American regrouped to lodge a new submission in February 2018 but in June the DoT issued an order requiring more information on a range of issues, including the expected benefits to travelers.

Joking that the airline had been saying for four years that it expected approval any day now, Qantas group chief executive Alan Joyce said he believed the application was making good progress.

“American Airlines do believe that progress is being made with the regulator over there but they have to take the appropriate time to do it,’’ he said at the International Air Transport Association annual meeting in Seoul. “They’ve had a lot on with the issues that have occurred in the US with transport.”

Joyce said the partners would probably add three trans-Pacific routes if the alliance was approved.

He said Qantas already had the aircraft to be able to operate the new routes.

“We’ll probably do a couple, American Airlines one,’’ he said. “We’ve said before it possibly will be Brisbane to Chicago, Brisbane to Seattle or Brisbane to Dallas as a new route.

“We have a number of ideas of very good routes into the US and expansion if it’s approved.

The flying kangaroo is also on the hunt for a new partner in India after the collapse of Jet Airways affected its feed to the sub-continent via Singapore.

“they were a big partner and we were carrying a lot of traffic on them,’’ he said. “We have been approached by just about every major Indian carrier because they know that and they know there’s a lot of traffic we can put on them.

“So we’ve had dialogue in the Last few days with four different carriers about possible agreements with them.”

Joyce said Qantas was exploring all its options, noting it was a big market but flying direct did not currently work for the Australian carrier.

“So Singapore was a great way of doing it,’’ he said. “We’d like to continue that and get the right partner.”

Jetstar Asia also had a relationship with Jet Airways and CEO Gareth Evans said the conversation was not just about Qantas.