Emirates says Qantas deal will take up to 6 months
Strong evidence that a Qantas deal with Emirates will be a simple code share, at least as currently envisaged, has come from news wire reports from Dubai today.
Bloomberg reported that:
“We’ve been engaging with them for some time,” Emirates Chairman Sheikh Ahmed bin Saeed al-Maktoum told reporters in Dubai yesterday. “The objective is to eventually see Qantas fly through Dubai.” The two sides aren’t discussing a revenue- sharing accord, he said.
The report will hose down expectations that Qantas will have something material to say about the moves for a commercial relationship between both carriers when it reports its full year to 30 June financial results on 23 August.
It will however probably feed further reports emphasising various possibilities that might suit those of us who want to see a deal that will render Qantas more competitive, as well as end its eternal bleating about how wicked carriers like Emirates are, make that ‘were’, and every other excuse its management can dream up for their dismal record with the airline.
Presumably it might also end Qantas complaining about Australia’s second largest airline, Virgin Australia having an equity and alliance relationship with Etihad, the UAE’s second largest airline, once it is engaged in a different but effective type of commercial link to that country’s largest airline.
The six month time frame mentioned by the Emirates chair might also give Qantas enough time to reach preliminary readjustments or acquittals with other strategic partners, such as British Airways and Air France, both publicly antagonistic toward Emirates and engaged in high profile lobbying efforts to persuade UK and EU policy makers to curb the onslaught of the Dubai carrier in their markets.
One thing that does stand out, at this stage, is that it is Emirates that is doing most of the talking, while Qantas publicly refers to the fact that at any given moment it is always in alliance discussions of one form or another with other airlines, and that it has identified the development of alliances as a strategic imperative.
Those other carriers include Malaysia Airlines which announced today that it would increase its services between Adelaide and Kuala Lumpur to daily from a current level of six times a week from 31 October.
This move would be as much about heading off the expansion plans of its low cost rival Air Asia X in Australia as it would be about Qantas, and clearly aimed at developing Kuala Lumpur’s under used airport as an alternative SE Asia hub to Singapore’s Changi Airport.
Malaysia Airlines has its hands full fending off attacks on its home market by Singapore Airlines and Qantas subsidiary Jetstar Asia as well as from the Air Asia group, which is the most successful low fare franchise in the Asia hemisphere.
With Malaysia Airlines joining Emirates and Singapore Airlines as daily participants in the Adelaide market, Australian consumers have yet another example of fierce competition breaking out between Asian rivals for a share of a market in which Qantas has made itself irrelevant.