American’s anti-trust fever rises

Washington DC
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American Airlines aims to forge its third joint business agreement in less than a year with long-time Oneworld partner Qantas, in a bid to gain anti-trust approval to achieve optimal pricing, scheduling and joint sales for US-Australia flights.

Qantas chief Alan Joyce foreshadowed the potential for deeper ties back in January, when the carrier announced a shift of Sydney-San Francisco flights to a Sydney-Dallas pairing, stating Qantas and American planned to deepen their relationship, and would seek requisite approval of the enhanced ties from the relevant authorities.

Coincidentally or not, American and Qantas tabled their plans to seek approval for anti-trust immunity one day after Delta and Virgin Australia secured its tentative nod from US regulators to create their own immunised alliance.

US aviation consultant Robert Mann says American and Qantas could be trying to "ride that surf, so to speak", adding the Oneworld partners could be hoping to benefit from those two airlines completing a crucial first step in building their own transpacific joint venture.

Transpacific venture

American seeks to mirror all the advantages it enjoys through its recently-launched transpacific joint venture with Japan Airlines - and its long-awaited transatlantic tie-up with British Airways, Iberia, Finnair and Royal Jordanian, with the exception of revenue sharing.

A key element of achieving anti-trust would allow American and Qantas to optimise connections in Los Angeles for Qantas flights from Brisbane, Melbourne and Sydney, says American, allowing it to better time its flights to connect with Qantas, and vice-versa.

Dallas-Fort Worth is also a key element. Mann says it is possible Qantas concluded it could garner a more favourable mix of business travellers in offering direct flights from Sydney to Dallas than it netted in the San Francisco market. Mann says Dallas should be an interesting test of the volume and quality of traffic Qantas captures by shifting one of its Sydney long-haul pairings.

The type of agreement American and Qantas are attempting to secure is styled to maximise both the hub benefits and, just as importantly, the behind and beyond destinations, says Mann.

Anti-trust could also serve as a springboard for collaboration on new US-Australia routes. Both have Boeing 787s on order that could be ideal for a long-thin market like Chicago-Sydney. With the 787's arrival - and American's 777-300ERs - Mann says everyone is waiting to see how the carriers deploy those aircraft.

For more on other joint venture moves around the globe see our earlier report at: flightglobal.com/JVfever