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Qantas opposes Virgin-Etihad alliance

written by australianaviation.com.au | September 15, 2010
An Etihad A340

Qantas has lodged an objection to the proposed alliance between Virgin Blue and Etihad Airways with the Australian Competition and Consumer Commission (ACCC), in particular arguing that interim authorisation for it should not be granted.

In a letter to the ACCC, Qantas argues that the proposed alliance should not be granted interim authorisation as passengers would “suffer considerable harm and inconvenience if tickets are booked on a new service during the interim period but final authorisation is ultimately denied.” It also says that the commercial desire of Virgin and Etihad does not warrant urgent authorisation.

Qantas also noted that the application put forward does not make any mention of price coordination beyond Abu Dhabi to Europe and the UK, with the application currently only seeking permission to do so on routes from Australia to Abu Dhabi. “The consequences of such coordination should be fully analysed before the applicant begin any cooperation,” read the letter.

The opposition from Qantas comes after Virgin Blue received notice last week that authorities in the US were proposing to block its proposed joint venture arrangement with Delta Air Lines and the ACCC announced its intention to block a trans-Tasman alliance with Air New Zealand. Should the Etihad alliance also fail, it would present a major blow for the airline, which had been hoping to build its long haul strategy around feeding alliance hubs in Los Angeles and Abu Dhabi to offer passengers a range of connections throughout the world.

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