Qantas hopes to restart American Airlines joint venture

Qantas hopes to restart American Airlines joint venture

Qantas will apply once more to the US authorities for an expanded joint venture deal with American Airlines, in a move that could boost benefits for Qantas Frequent Flyer members: such as through improved earning rates for points and status credits on AA flights.

The airlines have previously applied to the US Department of Transportation for permission to more closely collaborate on flights between Australia and the United States, including new routes such as Sydney-San Francisco and Auckland-Los Angeles, but the DoT tentatively denied that application in late 2016.

In early 2017, Qantas reacted by cutting points, status credits and codeshares for passengers travelling with AA: preventing passengers from booking AA’s Sydney-Los Angeles flights in conjunction with Qantas journeys through the Qantas website.

“If you want any café or restaurant recommendations around DoJ or DoT headquarters, I can tell you, given the amount of time we’re spending there at the moment,” Qantas Group Executive Government, Industry & International Affairs Andrew Parker quipped at the CAPA Australia Pacific Summit in Sydney.

“We just think that the consumer case for this application is very strong… the fact that American Airlines has come to Auckland, we’ve gone to San Francisco, they’ve come from Los Angeles into Sydney with their own metal: it would not happen without our deep partnership.”

Speaking of Qantas’ changes to the partnership, Parker adds that “I think it’s a real reminder of what happens when decisions like these are taken (by the DoT): in other words, there are consequences… and there have been some changes to the relationship since we were rejected.”

“But we’re very confident… we have to be patient, but we’ll get there.”

Meanwhile, Qantas’ separate five-year partnership with Emirates on flights to the Middle East, Europe, Asia, New Zealand and parts of Africa – which allows Qantas to sell Emirates flights and coordinate on benefits, pricing and frequent flyer points – is up for renewal in the coming months.

The airline has recommenced that approval process with the ACCC, although the agreement won’t cover Qantas’ upcoming Perth-London flights due to government restrictions which prohibit UAE-based carriers from selling non-stop flights between Australia and the United Kingdom.

Chris Chamberlin
Chris Chamberlin is a senior journalist with Australian Business Traveller and lives by the motto that a journey of a thousand miles begins with a single step, a great latte, a theatre ticket and a glass of wine!
 

16 comments

  • Nathan Burgess

    Nburgess31

    2 Aug, 2017 01:42 pm

    Chris it will be interesting to see how the Emirates ACCC  approval process goes given how strategically important it is to Qantas.  The QF-AA agreement isn't as important given they are both in Oneworld but the Emirates one falling over would lead to major short and medium term issues for QF.
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  • Richard R

    rcnr25

    2 Aug, 2017 02:20 pm

    If the Emirates deal falls over maybe SYD-DXB-LHR won't last long. Would hardly be a F experience to have no Lounge access in DXB
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  • Himeno

    Himeno

    2 Aug, 2017 03:58 pm

    If the ACCC doesn't approve an extension to the EK/QF deal, I'd expect QF1/2 to quickly change back to going via east Asia.

    Would be nice in such an event if QF got into a partnership with CX and/or JL for EU routes.
    Though that might be a hard sell with the amount of traffic QF/CX/JL have on the AU-HKG/AU-JP route, but with VA/NH entering those routes, maybe there would be a chance.
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  • FLX

    FLX1

    2 Aug, 2017 05:54 pm

    @Himeno:
    "Would be nice in such an event if QF got into a partnership with CX.."
    This is a joke right?  U can't be serious with this comment given the bitter battle they fought against each other over  JetStar HongKong not that long ago.....it makes the battle between VA and QF look positively tame in comparison.

    I always believe CX and QF still hv some limited codesharing today only because they can't get out of their commitment to OneWorld alliance treaties/rules re prioritizing cooperation between members.....
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  • williamjs

    williamjs

    2 Aug, 2017 02:46 pm

    Not expecting much but would love a reconsideration of using QF FF to upgrade QF ticketed flights on EK metal
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    Nburgess31, BatteryBen

  • mviy

    mviy

    2 Aug, 2017 03:36 pm

    Especially on the MEL-DXB-LHR once QF exits from that route in March next year.
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  • Himeno

    Himeno

    2 Aug, 2017 03:54 pm

    The date of the QF9/10 change is the same week as the current QF/EK agreement expires.
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  • mviy

    mviy

    2 Aug, 2017 03:57 pm

    I wonder if the ACCC will be concerned about QF cutting it's capacity on the route to London?
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  • John Phelan

    John Phelan

    2 Aug, 2017 04:33 pm

    There is no way in hell the ACCC will not approve an extension of the current QF-EK agreement.
    Member who gave thanks

    Zac

  • moa999

    moa999

    2 Aug, 2017 04:51 pm

    Why?
    Fares certainly haven't increased. EU fares at record lows, and I'd think QF can argue substantial customer benefit via the greater number of codeshares to EU destinations
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  • John Phelan

    John Phelan

    3 Aug, 2017 12:29 am

    Yes exactly, hence my comment - "there is no way in hell the ACCC will not approve an extension..."

    (I think you missed the word "not").

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  • loopflyer

    loopflyer

    3 Aug, 2017 11:20 am

    Here's a tip.I don't qualify. That said, recently upon leaving HKG all the regular immigration lines were busy. I took the line next to two booths for special categories - diplomat, disability, et al. and not busy. These two booths took people from my line and it went very rapidly - so effectively 3 booths for the one line.
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  • Jon W

    Jon W

    4 Aug, 2017 12:43 pm

    Not sure if I'm reading this right but did QF and AA essentially actively conspire to treat each others FF members *worse* than they did before because they didn't get the deal last time (i.e. it wasn't the lack of deal deal that made them do that, but they voluntarily did so in a hissy fit after not getting what they wanted). 

    Isn't that extortion? If I was the regulators I would deny the deal on that behaviour alone, to show them they can't get away with such threats, and then place conditions on them to go back to the pre-extortion arrangements
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  • moecat

    moecat

    4 Aug, 2017 04:43 pm

    Do you really think the regulators care about status credits?
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  • Jon W

    Jon W

    4 Aug, 2017 05:27 pm

    No, but isn't the major factor considered by regulators that consumers will be advantaged - or at least that they won't be disadvantaged? I'm not sure deliberately reducing the consumer experience (however slightly) in retaliation to a regulatory decision bodes well. 

    It's more that their actions go against the spirit of what they are purporting to want for their consumers (a better deal), and their arguments they are trying to benefit consumers, rather than the quantum of the changes they've done. 
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  • jrfsp

    jrfsp

    4 Aug, 2017 05:50 pm

    Is there any indicative timeline to this application?
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24 May, 2019 11:18 am

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