Qantas, American pursue new global alliance benefits
Developments planned by Australia’s Qantas Airways and American Airlines demonstrate membership benefits for global alliance partners seeking to rationalize operations while improving competitiveness. The operators belong to Oneworld, whose members include British Airways (BA), Chile’s LAN, Iberia, and Japan Airlines (JAL), with Malaysia Airlines waiting in the wings. Joint agreements between members can enhance revenues while increasing efficiency.
The recently announced Qantas restructuring includes agreement with Oneworld partners to establish joint ventures and code-share arrangements and use members’ hubs as “regional gateways” to help stimulate international business. American’s development plans include a deal with Qantas on trans-Pacific services. For example, a revised agreement will see Qantas drop London services operated through Bangkok and Hong Kong, while BA will fly those passengers to Europe (and lease Qantas slots at London Heathrow). Qantas will retain its direct London Airbus A380 service through Singapore and pick up Sydney-bound BA passengers at Bangkok and Hong Kong.
The Australian flag carrier’s plans include a low-cost carrier partnership involving its Jetstar subsidiary and Oneworld partner JAL and a full-service joint-venture operation, based possibly at Kuala Lumpur (home of Malaysia Airlines, whose prospective Oneworld membership is being sponsored by Qantas). Agreement with Malaysia Airlines could give Qantas access to China and India, as well as Amsterdam, Istanbul, and Rome–three European target destinations identified by Qantas chief executive Alan Joyce and currently connected via London, Frankfurt and Hong Kong.
Qantas will move its single South American destination from Argentine capital Buenos Aires to Santiago, home of Oneworld Chilean member LAN. The Australian carrier claims the move will provide “unprecedented access” to the region’s markets through “a number of affiliate passenger airlines in Peru, Ecuador and Argentina.”
For its part, American has established an agreement with Qantas under which the Australian airline flies to Dallas-Fort Worth. Regional carrier American Eagle is not expected to surrender its status as an affiliate member of Oneworld, despite its owner having given notice that it wishes to “spin off” the business, by selling stock to existing shareholders or separately to another party. American has said that there is no reason why the regional should not continue to provide it with short-haul feed traffic to its five corner-stone U.S. hubs–services that will preserve the affiliate membership of the alliance.