Qantas and American Airlines will refile an application with the United States Department of Transport (DOT) seeking anti-trust immunity for the expansion of their joint business arrangement.
The airlines have carefully reviewed the DOT’s November 2016 Show Cause Order proposing not to grant approval for their original application and, after considering their options, taken the decision to refile in the coming months.
It’s both airlines’ view that the DOT’s decision didn’t take into account precedent, intense competition on trans-Pacific routes, or the benefits that a closer relationship between Qantas and American has already delivered, including two new routes.
The new application will make a strong case for the full consumer, tourism and trade benefits that would come with anti-trust immunity.
In the meantime, Qantas and American will scale back areas of cooperation that aren’t viable without immunity, including the following changes:
- Qantas will no longer codeshare on American Airlines’ services between Sydney and Los Angeles, for new bookings made for travel from 1 February 2017.
- Qantas will adjust its Qantas Frequent Flyer policy with American Airlines to bring it in line with other oneworld carriers from 1 May 2017.
- Passengers who have already booked a Qantas ticket to travel on American Airlines’ Sydney-Los Angeles service between 1 February and 30 September 2017 will not be impacted by these changes. From 1 October 2017, passengers with Qantas tickets on the American service will be re-accommodated on Qantas-operated flights.
- The goal of the US Open Skies policy is to facilitate expanded international passenger and cargo flights to and from the United States and promote increased travel, trade and economic growth by eliminating government interference and providing maximum operational flexibility for airline alliances. In this context, the DOT’s November 2016 Show Cause Order is unprecedented.
- Qantas does not have any free sale codeshare arrangements on overlapping sectors with any other partners, outside of similar joint business arrangements.
- Qantas will continue to codeshare on non-overlapping routes, including American Airlines’ service between Auckland and Los Angeles and more than 130 of American Airlines’ domestic services.
- Qantas operates more than 39 return services per week between Australia and five destinations in the United States as part of its normal trans-Pacific schedule (with an additional two flights per week between Melbourne and Los Angeles and three per week between Sydney and Vancouver on a seasonal basis).