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QF And EK Deal Given Green Light  
User currently offlineZKOKQ From Australia, joined Mar 2012, 476 posts, RR: 0
Posted (1 year 8 months 4 weeks 1 day 4 hours ago) and read 6351 times:

The draft decision has been handed down this morning.

http://www.news.com.au/business/comp...light/story-fnda1bsz-1226540887811

Congratulations to Tim Clark and Alan Joyce.

Quote:

QANTAS' partnership with Emirates is set to receive approval from the competition watchdog.

In a draft decision handed down today, The Australian Competition and Consumer Commission (ACCC) said it would authorise an alliance between the two airlines for a period of five years.

"The ACCC considers that the alliance is likely to result in material, although not substantial, benefits to Australian consumers," ACCC Chairman Rod Sims said.

Qantas and Emirates had been seeking a 10-year approval from the ACCC, but Mr Sims said he had concerns about potential fare increases on flights between Australia and New Zealand.

The tie-up between Qantas and Emirates will involve a sharing of schedules, pricing and marketing on routes between Australia and Europe, the Middle East, North Africa, Asia and across the Tasman.

Mr Sims said it will lessen competition on some international routes, but competition from other airlines would mitigate that impact.

However, Qantas and Emirates could reduce or limit capacity on routes between Australia and New Zealand under their partnership, which could result in higher airfares, he said.

"Given the dynamic nature of the aviation industry, the limited extent of public benefits and the significant role of the trans-Tasman capacity condition in the ACCC's decision, the ACCC considers it appropriate to review this authorisation earlier than the ten years requested by Qantas and Emirates," Mr Sims said.

Approval from the ACCC provides Qantas and Emirates immunity from court action for conduct that raises concerns about competition.

Qantas and Emirates are seeking a final decision from the ACCC before the end of March 2013.

Read more: http://www.news.com.au/business/comp...da1bsz-1226540887811#ixzz2FXiGaWgb


[Edited 2012-12-19 15:18:22]

14 replies: All unread, jump to last
 
User currently offlinefiscal From Australia, joined Oct 2009, 330 posts, RR: 0
Reply 1, posted (1 year 8 months 4 weeks 1 day 4 hours ago) and read 6295 times:

That is good news. I wonder when QF will be able to start adding FF seats that involve EK flights from PER?

User currently offlinesydscott From Australia, joined Oct 2003, 3053 posts, RR: 19
Reply 2, posted (1 year 8 months 4 weeks 1 day 3 hours ago) and read 6139 times:

http://www.businessday.com.au/busine...rings-attached-20121220-2bo2p.html

Great news for QF.

Quoting fiscal (Reply 1):
I wonder when QF will be able to start adding FF seats that involve EK flights from PER?

I would say they'll need to wait for the Singapore and New Zealand Regulators to give their blessing as well before they start loading seats on EK flights. But we've already seen MXP and MAN start to be added as codeshares and QF have just applied to the IASC to facilite the Italian capacity. January will start to see lots more activity! Very exciting news for QF.


User currently offlineZkpilot From New Zealand, joined Mar 2006, 4829 posts, RR: 9
Reply 3, posted (1 year 8 months 4 weeks 1 day 2 hours ago) and read 6010 times:

Quoting sydscott (Reply 2):
I would say they'll need to wait for the Singapore and New Zealand Regulators to give their blessing as wel

Seeing as the ACCC has already banned them from cooperating on the Tasman I fail to see how the New Zealand regulators are relevant. Likewise the flights are going from Oz to EU via DXB so no need for Singapore regulators for those flights... only for the IIRC one code share flight via SIN...otherwise Oz pax will just fly to SIN on QF and other pax will fly direct from DXB as currently occurs.



56 types. 38 countries. 24 airlines.
User currently offlineqf340500 From Singapore, joined Oct 2011, 160 posts, RR: 0
Reply 4, posted (1 year 8 months 4 weeks 1 day 2 hours ago) and read 5980 times:

Zkpilot, that with the Singapore Regulators was my thought as well, why do they need to give their approval to this whole thing?

Nevertheless, a great decision for QF, although now my favourite QF flight SIN - FRA is gone...

But SIN MEL should be still doable on QF / EK, i hope they will still have Premium Economy on this route


User currently offlineNZ107 From New Zealand, joined Jul 2005, 6428 posts, RR: 38
Reply 5, posted (1 year 8 months 4 weeks 1 day 1 hour ago) and read 5834 times:

Quoting Zkpilot (Reply 3):
Seeing as the ACCC has already banned them from cooperating on the Tasman I fail to see how the New Zealand regulators are relevant.

I didn't read it in that light.. It sounded more like they can co-operate; although they have to comply with regulations to do with capacity. Either way, it would sound rather contradictory if NZ/DJ could form an alliance but EK/QF couldn't. I'm not too sure if they took 5th freedom rights into consideration because AFAIK, there has been no increase in the agreement between NZ and UAE from the 4 daily flights they have currently; and hence EY could never start trans Tasman flights until they were given extra slots.



It's all about the destination AND the journey.
User currently offlineQuokkas From , joined Dec 1969, posts, RR:
Reply 6, posted (1 year 8 months 4 weeks 1 day ago) and read 5770 times:

Quoting Zkpilot (Reply 3):
the ACCC has already banned them from cooperating on the Tasman

In a television interview Rod Sims said that this decision did not prevent co-operation between EK and QF but is proposing a condition to restrict the ability of the airlines to reduce or limit capacity on these routes in order to lift airfares.
http://www.abc.net.au/news/2012-12-2...proval-for-qantas-emirates/4437422


User currently offlineaerokiwi From New Zealand, joined Jul 2000, 2707 posts, RR: 4
Reply 7, posted (1 year 8 months 4 weeks 22 hours ago) and read 5534 times:

Quoting Quokkas (Reply 6):
In a television interview Rod Sims said that this decision did not prevent co-operation between EK and QF but is proposing a condition to restrict the ability of the airlines to reduce or limit capacity on these routes in order to lift airfares.

But as ever with these approvals, it doesn't stop them from zero capacity growth... in a growing market. So effectively you find there will be reduced capacity over the five years - fares will rise.


User currently offlinelightsaber From United States of America, joined Jan 2005, 13102 posts, RR: 100
Reply 8, posted (1 year 8 months 4 weeks 22 hours ago) and read 5503 times:
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Wow. Quicker than I expected. This is good news for QF and EK. Most of what they want to do is now 'greenlighted.'

I'm curious what further growth QF might do from DXB. e.g, flights to SE Asia (QF already has code-share rights, but why not expand on their own metal).

Question (I admit I'm being lazy), does QF have rights to fly via the mid-east to secondary cities in Malaysia or Indonesia? That seems to be a BIG hole in EK's route map and I've wondered if there lack of expansion is due to bilateral rights? (Note, I'm asking a question.)

Quoting Zkpilot (Reply 3):
only for the IIRC one code share flight via SIN...

   That isn't exactly much of an impact to the alliance...

Quoting Quokkas (Reply 6):
but is proposing a condition to restrict the ability of the airlines to reduce or limit capacity on these routes in order to lift airfares.

Interesting. Than you for the link.

Quoting aerokiwi (Reply 7):
But as ever with these approvals, it doesn't stop them from zero capacity growth... in a growing market. So effectively you find there will be reduced capacity over the five years - fares will rise.

That shouldn't be of worry. In a low to no expansion scenario, if there is money to be made narrow bodies will fill that duty. If anything, regulators would want a dominant alliance to execute that strategy; it ensures customers go to competitors who will meet the growth needs.

Lightsaber



Societies that achieve a critical mass of ideas achieve self sustaining growth; others stagnate.
User currently offlinemariner From New Zealand, joined Nov 2001, 25235 posts, RR: 85
Reply 9, posted (1 year 8 months 4 weeks 22 hours ago) and read 5483 times:
Support Airliners.net - become a First Class Member!

Quoting ZKOKQ (Thread starter):
Qantas and Emirates had been seeking a 10-year approval from the ACCC, but Mr Sims said he had concerns about potential fare increases on flights between Australia and New Zealand.

I am always slightly surprised by the power given to bureaucrats in a market situation.

I thought the original ten years was sensible - five years leaves an enormous uncertainty about the future hanging over it. Give 'em the ten and if they are "naughty" threaten to take it away.

And that the New Zealand routes are the reason for the Five Year Plan I think is bizarre - it sounds like the Soviet Union.

The Commissioner said: “This is a serious tie-up between two major competitors on the routes to Europe" - so If there is concern about the NZ routes, carve 'em out, make them a separate issue. Don't hold the whole thing hostage to 'em.

But hey, despite his Grinch-like headline, Ben Sandiliands saw some merit in the ruling (and some possible unhappiness at Virgin Australia/Air NZ), so I guess there's an upside to everything.  

mariner



aeternum nauta
User currently offlineaerokiwi From New Zealand, joined Jul 2000, 2707 posts, RR: 4
Reply 10, posted (1 year 8 months 4 weeks 22 hours ago) and read 5469 times:

Quoting lightsaber (Reply 8):
That shouldn't be of worry. In a low to no expansion scenario, if there is money to be made narrow bodies will fill that duty. If anything, regulators would want a dominant alliance to execute that strategy; it ensures customers go to competitors who will meet the growth needs.

Yes it should. The Tasman market is a prime example of one that grows with price stimulation. Equally, it will grow with population/economic growth, albeit more slowly than with a truly competitive environment.

But with a duopoly it will enable the airlines to refrain from capcity increases to boost yield. Great for them, bummer for passengers. Judging from past behaviour and the airlines' eagerness to effectively merge to eliminate competition, I'd suggest this is their preferred approach.

And I don't want a wait-and-see appraoch, becuase if/when they do operate duopolistically, the customer loses (while waiting to see). I want maximum competition, all of the time.


User currently offlinegemuser From Australia, joined Nov 2003, 5651 posts, RR: 6
Reply 11, posted (1 year 8 months 4 weeks 17 hours ago) and read 5146 times:

Quoting lightsaber (Reply 8):
Question (I admit I'm being lazy), does QF have rights to fly via the mid-east to secondary cities in Malaysia or Indonesia?

I don't know for sure, but I doubt it. Up to this year ALL Australian bi-laterals with SE & South Asian countries were about transiting to Europe, so I doubt there is much there about secondary cities, they didn't really fit into that scheme.

QF do have rights from India to the Middle East, but once again its in the context of transiting to Europe, so I don't know if it could be used with EK.

Gemuser



DC23468910;B72172273373G73873H74374475275376377L77W;A319 320321332333343;BAe146;C402;DHC6;F27;L188;MD80MD85
User currently offlinemdavies06 From United Kingdom, joined Aug 2009, 384 posts, RR: 0
Reply 12, posted (1 year 8 months 3 weeks 22 hours ago) and read 2623 times:

http://www.businessweek.com/news/201...ussie-tourism-as-british-stay-home

An interesting article about how China is now the biggest contributor to Australia tourism growth

Perhaps in 10 years time we will say that it is EK who has been saved by this deal?

[Edited 2012-12-26 20:22:50]

User currently offlineEK413 From Australia, joined Nov 2003, 4916 posts, RR: 4
Reply 13, posted (1 year 8 months 3 weeks 20 hours ago) and read 2448 times:

Quoting mdavies06 (Reply 12):
http://www.businessweek.com/news/201...ussie-tourism-as-british-stay-home

An interesting article about how China is now the biggest contributor to Australia tourism growth

Perhaps in 10 years time we will say that it is EK who has been saved by this deal?

I'm not sure as to what your implying but the deal will save QF from the stiff Asian competition... The tie up will allow QF to concentrate on routes which have been neglected for to many years in mainland Asia...

EK413

[Edited 2012-12-26 22:50:27]


Good evening, ladies and gentlemen. We are tonight’s entertainment!
User currently offlinemdavies06 From United Kingdom, joined Aug 2009, 384 posts, RR: 0
Reply 14, posted (1 year 8 months 3 weeks 1 hour ago) and read 2018 times:

I reckon that the deal has allowed EK to get as much market share as it can in a potentially stagnant market whilst market growth shift to China where EK can't naturally serve from Australia.

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