While appeals are pending from the denial of their proposed alliance, Air New Zealand (ANZ) and Qantas Airways are looking at a variety of ways to co-operate that would not upset competition authorities or need regulatory approval.
"We are exploring a number of opportunities together," says Ralph Norris, ANZ's managing director. The two carriers have set up a joint ticket coupon processing facility in Fiji and are looking at joint engineering procurement and a common inventory pool, Norris says. He also mentions joint marketing through Qantas Holidays and co-operation in "some markets where we may be able to work together".
But the two carriers could be headed for trouble on new routes between New Zealand and Australia. Qantas plans to launch flights in December between Adelaide and Auckland. The two airlines argued in their unsuccessful alliance petition that this route, currently unserved, is one where they needed approval to co-operate because the traffic is too thin for two airlines.
ANZ now must decide whether to compete against Qantas on the Adelaide route. If it does not, or if instead it launches another trans-Tasman route that is now unserved, such as Hobart or Canberra, the two airlines risk a competition challenge on the grounds that they are tacitly allocating markets.
In May the Australian Competition Tribunal started hearing the airlines' appeal against last September's decision by the Australian Competition and Consumer Commission rejecting their alliance. In early July the New Zealand High Court will consider a similar appeal from the adverse ruling of the New Zealand Commerce Commission.
Geoff Dixon, Qantas chief executive, says his airline's recently announced plan to invest in a new Singapore-based airline will not effect its goal of winning these appeals and forming an alliance with ANZ.
DAVID KNIBB BRISBANE
Source: Airline Business
