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American & Qantas Try for Joint Business Agreement Again

By Michael B. Baker / 27 February 2018 / Contact Reporter
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American Airlines and Qantas once again are seeking U.S. Department of Transportation approval for a joint business agreement, more than a year after their previous attempt was quashed in the final months of the Obama administration.

This week, the carriers filed for the joint business, saying it would "improve service, stimulate demand and unlock more than $300 million annually in consumer benefits." American and Qantas would expand codesharing, offer more fare classes and discounts across one another's networks and launch more routes and city pairs between the U.S. and both Australia and New Zealand. It also could lead to "significant improvements in the overall customer experience, including additional frequent-flyer benefits and investments in lounges, baggage systems and other infrastructure designed to better serve the carriers' joint customers."

The carriers have worked together under antitrust immunity granted by the DOT since 2011. Then, they had no overlapping nonstop transpacific routes and American had no service to Australia. Expanding that alliance would include coordinating pricing and schedules and sharing revenue and would require additional approval. The airlines applied for that approval in June 2015, and the DOT rejected it in November 2016. The carriers are hoping for different results under the Trump administration, which in November approved a joint business agreement between Delta and Korean Air.

Australia and New Zealand regulators approved the joint business agreement in its previous filing.

In their joint statement, the carriers said they would have to cut back on codesharing and flights if the U.S. does not grant approval this time. That could include reducing capacity or canceling altogether Qantas' A380 service between Sydney and Dallas/Fort Worth International Airport and American's service between Los Angeles and each Auckland, New Zealand, and Sydney.

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