The US government has tentatively approved a joint venture between Qantas and American Airlines on trans-Pacific flights. The Oneworld partners will now be able to work much more closely on flights between Australia, New Zealand and the United States, bringing additional benefits for frequent flyers and opening the possibility of new Qantas routes to North America.
Qantas and American Airlines initially applied for anti-trust immunity in 2015, the same year that American Airlines began flying to Sydney. This request was approved by Australia and New Zealand, but eventually rejected by the US government under the Obama administration in 2016.
A new request for a joint venture between Qantas and American Airlines was submitted to the US government in February 2018, with various changes. These included the removal of a provision that would have prevented airlines other than American Airlines from code-sharing on Qantas trans-Pacific flights. Now, the airlines’ modifications – and patience – seems to have finally paid off.
American Airlines and Qantas have already been in a codeshare partnership for the past 30 years. Both airlines are also founding members of the Oneworld alliance, which recently celebrated its 20th birthday. But to enter into a joint venture – which allows the airlines to coordinate prices, schedules, frequent flyer benefits and even share revenue with each other – approval is required from competition regulators in each of the countries involved. Short of merging, a joint venture is the highest level of cooperation available to airlines.
Virgin Australia is already in a joint venture with Delta on flights between Australia and the United States of America. The only other airline to offer direct flights between Australia and the USA, United, has a joint venture with Air New Zealand on the New Zealand-USA market.
Qantas currently has joint ventures with Emirates and China Eastern, however these alliances specifically do not extend to the North American market.
A final decision is expected from the US government in the coming weeks. Once approved, the joint venture could open new benefits to Qantas Frequent Flyer members when flying with American Airlines, such as the resumption of Qantas codesharing on American’s Sydney-Los Angeles and Auckland-Los Angeles flights. A reinstatement of the minimum points guarantee on American Airlines flights could also be on the cards.
The joint venture would also ensure the survival of Qantas’ Sydney-Dallas/Fort Worth route, which depends heavily on American Airlines connections. 85% of passengers on QF7/8 connect to or from an American Airlines flight in Dallas.
Once the American Airlines joint venture is approved, Qantas also plans to launch two new Boeing 787 routes from Brisbane to San Francisco and Chicago. Qantas does not currently fly to Chicago, but Brisbane-Chicago is within the Dreamliner’s range. Air New Zealand began direct flights from Auckland to Chicago last year.
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