The level of rhetoric is one measure of how much is at stake as final regulatory decisions draw near on the proposed alliance between Air New Zealand (ANZ) and Qantas.
Both the Australian Competition and Consumer Commission and New Zealand Commerce Commission, the competition watchdogs in their respective countries, promise to make their final rulings before the end of September. If approved, the alliance would dramatically change Australasian aviation.
Verbal exchanges between advocates and opponents reached a crescendo in August when the New Zealand commission held a six-day conference to hear both sides of the argument. The deal would see Qantas taking a 22.5% stake in ANZ, with the two carriers merging operations in all markets where they now compete. In draft decisions in April both competition agencies rejected this plan, but they have since received further undertakings and analysis.
The New Zealand hearing was like a regional convention of senior aviation management. The chief executives of ANZ and Qantas, Ralph Norris and Geoff Dixon, reiterated why the alliance is essential. Tony Marks, the new chief executive of New Zealand domestic carrier Origin Pacific, and David Huttner, Virgin Blue's commercial manager, spoke against it. A host of airport managers, unions, exporters, and consumer groups mostly opposed the alliance.
ANZ's Norris also visited Australia for a round of speeches and TV appearances, hoping to tilt local opinion towards the merger. IATA gave Qantas and ANZ a boost when its director general Giovanni Bisignani told a Sydney audience that the body backed their plan.
But Peter Harbison, managing director of the Centre for Asia Pacific Aviation Studies in Sydney, predicted the competition agencies would reject the merger proposal. He calls on Singapore Airlines to re-enter Australasian aviation, where he claims it is needed to offer a level of competition that would make a Qantas-ANZ alliance more palatable.
In a move which may be related to the increasingly heated merger debate, British Airways has threatened to pull out of Australia if Canberra fails to renew its joint service agreement with Qantas.
DAVID KNIBB SEATTLE
Source: Airline Business
