Qantas and Emirates today announced a new global aviation partnership that will give their customers a seamless Australian and international network, exclusive frequent flyer benefits and “world-class travel experiences”. Qantas also announced that it had agreed with British Airways to terminate their joint business from 31st March 2013. The airline will also restructure its Asian network to strengthen its focus on services to and within the region.
Under the agreement signed this morning by Emirates President Tim Clark and Qantas Group Chief Executive Alan Joyce, Qantas will move its hub for European flights to Dubai and enter an extensive commercial relationship with Emirates.
The 10-year partnership will go beyond codesharing and includes integrated network collaboration with co-ordinated pricing, sales and scheduling as well as a benefit-sharing model. Neither airline will take equity in the other.
Qantas will launch daily A380 services from Sydney and Melbourne to London via Dubai, meaning that together Emirates and Qantas will offer 98 weekly services between Australia and Dubai. Qantas will be the only other airline operating to Terminal 3 and the new purpose-built A380 concourse at Dubai International Airport.
The partnership will give Qantas customers one-stop access to more than 70 Emirates destinations in Europe, the Middle East and Africa. For Emirates customers it will open up the Qantas Australian domestic network of more than 50 destinations and 5,000 flights per week. The carriers will also co-ordinate on their services between Australia and New Zealand and services between Australia and South East Asia.
The Emirates and Qantas frequent flyer programmes will be aligned, giving customers expanded opportunities to earn and redeem points. Emirates and Qantas will provide reciprocal access to tier status benefits including end-to-end customer recognition, lounge access, priority check-in and boarding and other exclusive services.
Qantas Group Chief Executive Alan Joyce said the partnership would deliver unprecedented benefits to Qantas customers and mark a decisive step forward in the Group’s strategy. “Emirates is the ideal partner for Qantas,” he said. “It has a wonderful brand, a modern fleet, an uncompromising approach to quality and it flies to the A-list of international destinations.
“This is the most significant partnership the Qantas Group has ever formed with another airline, moving past the traditional alliance model to a new level. It will deliver benefits to all parts of the Group.
“As the world’s largest international airline, with a network that perfectly complements our own, Emirates will help us give our customers across Australia a dramatically expanded range of travel options.
“Together with Emirates, Qantas will provide a unique ‘one-stop’ hub service, as well as deeply integrated frequent flyer and customer benefits.
“The partnership delivers on all four pillars of the Qantas Group’s international strategy: it will see us fly to the global gateway city of Dubai, provide some of the world’s best travel experiences through Qantas and Emirates, improve our network in Asia, and, crucially, help build a strong Qantas International business for the long term.
“There will be considerable benefits for the broader economy as we collaborate with industry to drive more inbound trade and tourism. I very much look forward to working with Tim and everyone at Emirates as we develop this exciting,
transformative partnership.”
“The time was right to develop a long-term partnership with Qantas, the iconic Australian airline,” said Tim Clark, President of Emirates. “Since our first flights began in 1996, Australia has long been a popular destination for Emirates leisure and business travellers, making it one of the top three destinations in our network.
“By establishing this partnership we are providing our passengers with additional connectivity in Australia and the region, the ability to utilise reciprocal frequent flyer benefits and access to premium lounges and travel experiences.”
The airlines will submit an application for interim authorisation to the Australian Competition and Consumer Commission (ACCC) in order to begin commercial planning. Subject to regulatory approval, it is anticipated that the partnership will commence in April 2013.
Broader Qantas Network Changes
Qantas will restructure its Asian network to strengthen its focus on services to and within the region. “We currently have an Asian flying schedule based on travelling via Asia to Europe,” added Alan Joyce. “But our Australian business customers want better access to Asia, and we have been looking to address this for some time.
“With European services transiting through Dubai, Qantas’ Asian services will no longer be a subsidiary of the ‘Kangaroo Route’. Instead they will be dedicated to connecting Australians with our region, and Asian visitors to Australia.
“We will increase dedicated capacity to Singapore and re-time flights to Singapore and Hong Kong to enable more ‘same day’ connections across Asia. We believe this will significantly improve the economics of our Asian operations.”
Qantas will also withdraw from the Singapore – Frankfurt route. While this service has been underperforming for some time, and withdrawal was inevitable, the partnership with Emirates will enable it to take place with minimal impact on Qantas customers.
British Airways Joint Business
International Airlines Group’s wholly owned subsidiary British Airways and Qantas have agreed to terminate their joint business from 31st March 2013. The joint business was established in 1995 to enable close commercial co-operation on Qantas and British Airways services between the Australia and the UK. The airlines will continue to work together as part of the Oneworld alliance and through bilateral codeshares.
Alan Joyce said: “Over the past 17 years the joint business with British Airways has been central to the Qantas network. However, global operating conditions have changed and partnership with Emirates is the right strategy for Qantas. I would like to thank IAG Chief Executive Willie Walsh and British Airways Chief Executive Keith Williams for their support of the joint business and I look forward to a continued strong relationship in future.”
Willie Walsh said: “We are ending the joint business on amicable terms and support Qantas’ decision to work with Emirates. The world has changed since 1995 when the joint business started. This is a small part of our overall network and this move fits in with changes in our global strategy. Asia has become a key market focus for IAG and we are talking to a number of airlines about alternative options for us.
“Qantas has made it clear that its international performance has been weak and the termination of the joint business won’t have any negative impact on IAG’s financial targets. The good relationship that we have with Qantas Chief Executive Alan Joyce and his team will continue through our joint membership of Oneworld.”
Qantas will contact any customers due to travel after 31st March 2013 whose bookings may be affected by changes to the joint business, to discuss alternative travel options.
