Carriers object to Qantas proposal

Carriers object to Qantas proposal
By admin

Air New Zealand has urged the competition regulator to keep tabs on how Qantas and Emirates market their proposed alliance as it argued against the granting of interim authorisation for the tie-up.

The carrier’s partners, Virgin Australia and Singapore Airlines, have also objected, arguing the case is complex and needs too much scrutiny to allow planning to take place before a full assessment is made.

In a submission to the Australian Competition and Consumer Commission (ACCC), Air NZ said the “applicants are already promoting the alliance on a generic basis.”

“It is crucial that consumers are not misled,” Air NZ said. “If any promotion or marketing is permitted it should very clearly highlight to consumers the fact that the alliance is subject to regulatory approval.”

The Kiwi carrier said material on promotes the alliance “without clear reference to the regulatory approval required”.

Virgin, in its submission to the ACCC, said some pre-planning does not require interim authorisation.

But if the conduct goes further “interim authorisation should not be granted as there is a high risk that the conduct would give rise to anti-competitive detriment”.

Virgin told the ACCC that, given the number of overlapping routes, the combined market share of Qantas and Emirates is “very high”.

There can be “no question” that competition will be impacted which will require careful consideration by the ACCC.

“Virgin Australia considers it would be more appropriate for the ACCC to fully assess whether the Proposed Conduct, which has competition implications for a number of markets, should be authorised before the applicants begin any form of cooperation,” the submission said.

Furthermore, Qantas fails to substantiate why the granting of interim authorisation would result in claimed “public benefits”.

Singapore Airlines said it was concerned granting interim authorisation would have “far reaching and difficult to reverse impacts” including preparing joint marketing campaigns and developing joint systems for inventory, ticketing, revenue management and pricing.

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