Qantas and British Airways were breathing more easily in December after Australia's route right authority cleared the pair to extend codesharing on the London to Australia Kangaroo Route.

The decision represented a backdown by the route authority, the International Air Services Commission. The IASC had earlier published a draft ruling barring the two carriers from adding more joint services to a number of codeshares being operated.

As Qantas and BA heaved a sigh of relief, their competitors' concerns were also being eased. Singapore Airlines, Ansett Australia and Air New Zealand, as well as Malaysia Airlines and KLM, had all formulated plans for joint services. The airlines had feared that while reviewing BA/Qantas, the commission might decide to stymie the other airlines' arrangements and damage a strategy designed to compete better with BA and Qantas.

The commission had initially indicated that it would refuse permission for additional codeshares, but in its final view the benefit to the airlines from further codesharing outweighed the disadvantages, namely that consumers would suffer because there would be a reduction in flights operated by Qantas in its own right.

Qantas chief executive James Strong welcomed the IASC's regulatory decision, saying it would allow both carriers to strengthen their partnership further and would provide customers with an unprecedented choice of flights between England and Australia.

'The introduction of codeshare services on the Kangaroo Route was a natural synergy to the codeshare services introduced on regional services to five cities in the United Kingdom, three in continental Europe and on 79 flights in Australia earlier this year,' says Strong.

However, the IASC decision does not guarantee clearance for further codeshares which Qantas has recently applied for. The carrier was awaiting finalisation of bilateral talks between Australia and Thailand, scheduled for mid-December, after which it planned to apply for more joint services with BA through Bangkok. The IASC, after already expressing doubts about the extent of codeshares, is bound to ponder that application very closely.

Under the latest IASC decision, BA/Qantas began operating new codeshare services on 10 December. The two are now offering 310 joint flights each week between 18 destinations between Australia and the UK via Singapore.

John Wood, British Airways' regional director Asia pacific, sees the extension of codesharing as further evidence that the partnership with Qantas was 'going from strength to strength and continuing to deliver real benefits for passengers of both airlines'.

Tom Ballantyne

Source: Airline Business