Qantas given final approval for expanded alliance with American Airlines

Antitrust immunity authorised by Trump Administration

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The US Government has rubber-stamped the proposed joint business agreement between Qantas and American Airlines, paving the way for the start of the flagged new non-stop flight routes across the Pacific between Brisbane and both Chicago and San Francisco. The decision follows tentative authorisation from the US Department of Transportation (DOT) last month.

Qantas said that final approval means the oneworld partners will now be able to coordinate, as part of a joint business, “more destinations, reduced travel time, lower fares, and additional benefits for frequent flyers”.

“We look forward to working closely with our valued partner, Qantas, on this new joint business,” said American’s Chairman and CEO Doug Parker. “We now have the opportunity to launch new routes and provide enhanced service with better schedules, additional frequent flyer benefits and continued investments in the overall customer experience.”

The DOT handed down its long-awaited final decision having reviewed comments submitted, determining that “no changes in the tentative decision are necessary to address the issues raised”.

In the DOT’s Final Order, it said Qantas and American Airlines must implement their antitrust immunity arrangement within six months and will be required to provide a self-assessment of the venture in seven years time.

“The proposed period will allow the Joint Applicants sufficient time to implement the joint venture, while also providing for accountability and oversight. The review would align with the Australian Competition and Consumer Commission’s re-authorisation review and thus reduce the regulatory burden on the Joint Applicants,” the US transport regulator said.

As part of the joint business, the DOT also imposed conditions requiring that Qantas and American Airlines provide interline access for new entrants in the US-Australasia market for feeder flights.

The two new routes will be operated by Qantas’ Boeing 787-9 Dreamliner aircraft, and are earmarked to launch by the end of April 2020. Qantas said the schedule for the new Brisbane-Chicago and Brisbane-San Francisco flights are being finalised, and that fares will be available for sale soon.

Qantas and American Airlines will also add codeshare services to more of each other’s existing international flights between Australia and the United States with customers able to purchase these codeshare flights in coming days.

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