Qantas and Virgin Australia are set to split the two available daily slots recently made available for Australian carriers at Tokyo Haneda international airport.
A draft ruling from Australia's International Air Services Commission states that after considering submissions from both carriers, it intends to award one daily slot each to Virgin and Qantas.
Qantas had previously argued that it should be allocated both Haneda slots, which would allow it to launch a second daily service there from Sydney, and to move its Melbourne-Tokyo Narita route to the more desirable airport.
Cirium schedules data shows that Qantas and ANA are the only airlines that fly between Australia and Haneda, with both carriers flying daily to Sydney.
Virgin, however, sought one of the slots to allow it to launch a daily Brisbane-Haneda flight, which would be its first flight to Japan. It also plans to enter into a reciprocal codeshare agreement with All Nippon Airways to provide feed for each other's services.
In weighing up the competing applications, the Commission judged that splitting the two slots would bring the greatest competitive benefit to the market.
"The Commission considers that providing consumers with more options, such as a greater number of service providers, more flight schedule options and more city-pairs to choose from, generally provide consumers (members of the public) with greater benefit," it states.
It rejected Qantas's assertions that it was the only carrier in Australia that was able to be ready to commence the new flights by the start of the northern summer scheduling season. It also rebutted the Oneworld carrier's argument that Virgin could still fly between Australia and Narita instead of operating into Haneda.
"Although there is unrestricted capacity to operate services to and from Narita, the Commission accepts that there are other challenges for new entrants to the Australian-Japan route to make their services commercially sustainable if operated from," the IASC states.
The Commission will now accept submissions by 24 October, but it appears unlikely that it will change its position.
Virgin says that it is pleased with the draft determination and plans to "bring strong competition and choice to the market" when it commences its planned Brisbane-Haneda services on 29 March 2020.
Qantas application did not state what it would do if it were only allocated the one frequency, but the Commission found that would not affect the increased competition benefits of allocating the other slot to Virgin.
"We look forward to adding even more flights from Australia to Haneda Airport. We’ll confirm whether these flights will operate from Melbourne or Sydney shortly," Qantas tells Cirium.
The Commission also approved the proposed codeshare agreement between Virgin and ANA on their respective Australia-Japan routes, noting that it " will provide enhanced competition in the market between Australia and Japan, and will support Virgin Australia’s capability to serve the route."
However, that approval only covers routes where the carriers do not overlap, and permission would be required if in future they were to extend that onto routes that both carriers operate.
UPDATED: Added comment from Qantas that was received after article was initially published.
