SA and QF Codeshare to end with one airline stopping JNB to Oz flights?

[markis10]

Looks like things are coming to an end for the JNB arrangement, no guesses who will likely pull out!

Qantas had warned the commission that one of the airlines is likely to pull out of the route if their tie-up is not allowed to continue.

But in a decision released today, the commission said the Qantas-SAA tie-up was a ‘‘poor substitute’’ for direct competition on the route, describing the state of the market for passengers travelling between Australia and South Africa as ‘‘limited’’.
‘‘The two airlines have an effective monopoly on the main routes (Sydney and Perth), subject to very little competitive constraint from third-country airlines or threat of entry [from another airline],’’ it said.

Read more: Regulator sends Qantas's SAA plans packing
​

 

[kpc]

Glad I decided to do Syd-Sin-Cpt on SQ later this year as opposed to Syd-Jnb-Cpt with QF / SA...

 

[wingspan]

Glad I decided to do Syd-Sin-Cpt on SQ later this year as opposed to Syd-Jnb-Cpt with QF / SA...

Feeling the same way about my SYD-MEL-HKG-JNB-CPT-JNB-HKG-MEL-SYD in July with QF and CX right now too!

 

[docjames]

I have seen reports elsewhere that SAA are financially facing many of the same pressures as most airlines. So it may be interesting to see who blinks first.

Would PER-JNB be possible range-wise with an A332 or 763ER? QF could always downsize whilst awaiting a 789 which would seem the ideal aircraft for the route size-wise (but ETOPS would be an issue even at 240min). Or move the 744 onto a SYD-PER-JNB routing.

Great Circle Mapper

 

[drron]

Watching with interest as early 2013 will be our trip to Africa.

 

[cliff]

2nd March 2012 - South African Codeshare Extension Nixed.

"The International Air Services Commission has announced that it will not extend QANTAS and South African Airways permission to codeshare on each other’s services between Australia and South Africa beyond 31st December 2012. The Commission states that the airlines run a duopoly on the route. At present QANTAS operate Sydney - Johannesburg services and South African Airways operate Perth - Johannesburg services with each airline taking a guaranteed number of seats on the other’s flights. QANTAS say the decision will mean that one or both carriers will be forced to reduce frequency or withdraw flights."

Can someone please explain the above to me -Is this a good or bad thing , will flights be reduced , will fares go up ?
Why would a monopoly be better then a duopoly ?

 

[cmon0005]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

I think its a bad thing, what they will end up doing is turning it from a 'duopoly' to Monopoly. My guess is one of them will pull out on the route altogether and we will see fare prices rise in my own opinion.. coupled with reduced capacity = worse for the consumer.

Oh well time will tell exactly how this pans out.

 

[kamchatsky]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

I think its a bad thing, what they will end up doing is turning it from a 'duopoly' to Monopoly. My guess is one of them will pull out on the route altogether and we will see fare prices rise in my own opinion.. coupled with reduced capacity = worse for the consumer.

Oh well time will tell exactly how this pans out.

But then again I do see SQ and MH offering decent fares to SA anyway? Sure it is a detour but still they are very good airlines to fly with.

 

[dajop]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

DXB-JNB-SYD anyone? I'm sure they'd be in it if they could

 

[SeaWolf]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

Can someone please explain the above to me -Is this a good or bad thing , will flights be reduced , will fares go up ?
Why would a monopoly be better then a duopoly ?

It's too early to tell really. IASC believes that if the two airlines are no longer allowed to collaborate on the route, the market and demand is large enough that they will compete and prices will come down, or frequency and routes will increase. If that happens it's also possible that better prices and flexibility will grow the market as well.
QANTAS and SAA have argued that the market is too small for them both if they can't collaborate and so there will be reduced frequency, routes or one carrier may pull out entirely. They may believe that to be true, or they may have been arguing it so that they could continue to collaborate and not have to compete, which is obviously more effort, risk etc. than if they don't have to bother.
Really, it's a wait-and-see thing. It may end up having no effect either way.

 

[rsellens]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

VA tried to compete but pulled out 12 months ago to go to AUH instead so it was obviously not profitable for them. Doubt if another airline will go into it and it will now give AJ another excuse to abandon another route, possibly leaving SAA on their own. So there will be no competition anyway. Just inconvenience to Australian travellers.

 

[docjames]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

VA tried to compete but pulled out 12 months ago to go to AUH instead so it was obviously not profitable for them. Doubt if another airline will go into it and it will now give AJ another excuse to abandon another route, possibly leaving SAA on their own. So there will be no competition anyway. Just inconvenience to Australian travellers.

But part of VA's problem was the >2hr diversion they needed to take to remain within twin engine regulations....

 

[The Rok]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

I am not sure that it was unprofitable for VA, I think it was more the hassle of running the service and the fact that AUH would be more profitable. Also, BNE/MEL/SYD - JNB would have lore loads than PER-JNB. The Perth flight is pretty much consistently full. I think if VA did decide to do a mjor assault on PER then JNB would be back on the table, but they simply don't have the metal to do it right now.

 

[elbarto]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

The detour caused by ETOPS would have no doubt impacted on the profitability and if it was a cash cow they would have kept it. Sooner or later Australian regulators are going to have to allow ETOPS 330 otherwise no Australian based airline is going to operate routes to Southern Africa and South America as the only quad jets left on the market for new builds are the A380 and 747-8 which are both too big.

 

[kamchatsky]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

The detour caused by ETOPS would have no doubt impacted on the profitability and if it was a cash cow they would have kept it. Sooner or later Australian regulators are going to have to allow ETOPS 330 otherwise no Australian based airline is going to operate routes to Southern Africa and South America as the only quad jets left on the market for new builds are the A380 and 747-8 which are both too big.

For whatever reason I always thought SQ can extend SIN-SYD to SIN-SYD-EZE on A380 daily and have connections with VA from MEL/BNE/ADL/PER and NZ (from NZ of course) having all the codeshare agreement with it.

 

[elbarto]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

For whatever reason I always thought SQ can extend SIN-SYD to SIN-SYD-EZE on A380 daily and have connections with VA from MEL/BNE/ADL/PER and NZ (from NZ of course) having all the codeshare agreement with it.

SQ would have to have rights to fly beyond Australia to do that.

 

[moa999]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

Merely postulating

Without codeshares QF to drop the direct and fly SYD-PER-JNB,
this will hurt SA ex-PER and cause them to drop out altogether.

 

[cmon0005]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

I was also thinking isn't the whole idea of codeshares to do exactly what they're doing, share the route and capacity.etc ?

 

[wandering_fred]

Re: 2nd March 2012 - South African Codeshare Extension Nixed.

Merely postulating

Without codeshares QF to drop the direct and fly SYD-PER-JNB,
this will hurt SA ex-PER and cause them to drop out altogether.

[sarcasm]
But wouldn't that cause QF to perhaps make money on an international route?
As well as consider an international route from PER? And offer reasonable seating and
Y+ PER-SYD?
[/sarcasm]

Fred

 

[The Rok]

Last I checked the only airlines with an interest in international operations out of Perth were Emirates and Singapore Air!