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|17 February, 2018

Better fares on Emirates, Qantas to impact Qatar and British Airways

Aussie regulator gives initial approval for airlines' partnership extension

An Emirates Airlines Airbus A380-800, with Tail Number A6-EEV, lands at San Francisco International Airport, San Francisco, California, April 11, 2015. Image used for illustrative purpose.

An Emirates Airlines Airbus A380-800, with Tail Number A6-EEV, lands at San Francisco International Airport, San Francisco, California, April 11, 2015. Image used for illustrative purpose.

REUTERS/Louis Nastro

The partnership between Dubai's Emirates and Australia's Qantas has received an initial nod for another five years from Australian authorities, which will result in better airfares for passengers and stiffer competition for carriers such as Virgin Australia, Qatar Airways and British Airways.

Though the final decision is expected in March, the airlines have received a draft determination from the Australian Competition and Consumer Commission (ACCC) that proposes to grant authorisation for their partnership for another five years.

Saj Ahmad, chief analyst at StrategicAero Research, said in some cases, there has been better and more competitive fares, particularly in Emirates' case where passengers can pay the lowest price, but then have to perhaps pay for a better seat, unless they wait until check-in time and get it for free although they may not get the seat they desire.

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"Either way, customers have far more choice connecting via Emirates and Qantas between the northern and southern hemisphere compared to any other airline or grouping. And prices reflect that competitive edge," he said.

As a result of this partnership, Emirates achieved both extra flights and capacity into Australia and the carrier has shared the spoils with Qantas, he added.

"This partnership has alleviated a competitive threat and both airlines have integrated their bookings and networks so that they both harness the demand for travel in and out of Australia - especially on services to the Gulf and Europe," he said. According to Ahmad, the biggest impact will be to smaller players like Virgin Australia, Qatar Airways and British Airways. "Others like British Airways will be smarting since BA has come in for a lot of criticism lately for its poor services and in contrast to the opulence and quality of Emirates, it's not hard to see why they'd be losing out - and they'll continue to lose out because they fail to connect Australia-originating passengers to other parts of the UK like Emirates does - such as Manchester, Glasgow and Birmingham, for example," he added.

"BA doesn't operate any long-haul services from any of those cities to Australia, so Qantas and Emirates capture that swathe of the market too." An Emirates spokesperson said that more than eight million passengers have benefited from the two airlines' joint network since the partnership began in 2013.

"We are pleased that the ACCC's draft determination supports the authorisation of our partnership with Qantas for a further five years until 2023," the spokesperson said.

A Qantas spokesperson said that with three options to get to Europe, via Perth, Singapore and Dubai, and more frequencies between Australia and New Zealand, the partnership better reflects customer demand, leverages new aircraft technology and plays to each airline's respective network strengths.

"The first five years of the partnership has lived up to the promise of serving our customers better, together, and the changes to our network are designed to reinforce this for the next five years," the spokesperson added.

 

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