Qantas and China Eastern will apply to competition authorities for a proposed joint-venture which they say will deepen an existing commercial relationship and hopefully lead to new routes and more onward connections from the Chinese carrier’s Shanghai hub.
The two airlines, who already have an existing codesharing arrangement, signed the proposed five-year partnership for flights between Australia and China at Parliament House in Canberra on Monday.
“We’re looking forward to working more closely with China Eastern to bring together our complementary networks and enhance the options for the increasing number of Qantas customers travelling to Shanghai and beyond,” Qantas chief executive Alan Joyce said in a statement.
“Coordination means the opportunity to improve schedules and connection times, and to deliver improved products such as a joint lounge and streamlined check-in facilities in Shanghai. It will be a win for our customers and, by making it easier for Chinese travellers to visit Australia, a win for trade and tourism”.
Joining the Qantas chief executive and China Eastern chairman Liu Shaoyong at the signing ceremony were Australian Prime Minister Tony Abbott and Chinese President Xi Jinping.
“Through the new partnership, the airlines hope to ultimately open up new routes between Australia and mainland China, such as between Brisbane and Perth to Shanghai,” Qantas said in a statement on Monday.
Qantas currently flies daily between Sydney and Shanghai, the Flying Kangaroo’s sole destination in mainland China with its own aircraft.
In Oceania, China Eastern currently flies to Melbourne and Sydney from its Shanghai hub and previously also served Cairns. It will soon commence summer seasonal services between Shanghai and Auckland, which will run from December to March.
Under the proposed JV, the two airlines would operate out of Shanghai Pudong’s Terminal One, which the two carries said would result shorter in transit times and therefore more choice for passengers.
Qantas and China Eastern have codeshared on each other’s services between Australia and Shanghai, as well as beyond gateway points, since 2008.
The Australian flag carrier also codeshares on China Southern’s flights from Australian to Guangzhou and points beyond.
“Australia is one of the most important tourist destinations and trade markets for China, and Qantas is the key partner for China Eastern in Australia,” Liu said.
“It’s important for us to strengthen the cooperation with Qantas to provide better, more convenient travel products for passengers between the two countries.”
The JV, if approved, would commence in mid-2015 and, Qantas said, “complement” the airline’s portfolio of international partners such as Emirates for services to Europe, the Middle East and North America, American Airlines for North America and LAN Chile for South America.
On Monday, the leaders of Australia and China signed a Declaration of Intent to mark the end of negotiations over a free-trade agreement between the two nations. The FTA was expected to be signed in 2015.
Chinese tourism was Australia’s largest inbound tourism market. The two carriers said inbound tourism from China to Australia was expected to be worth $9 billion annually to the Australian economy by 2020.