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Qantas CEO Alan Joyce has hinted his airline will fight on in its attempt to buy Alliance despite the ACCC blocking the deal last month.
Joyce told reporters on Monday the Flying Kangaroo is “reviewing its options”, and the purchase would be a positive for the national carrier.
The airline has previously only said it would seek a meeting with the watchdog and argued a deal would not weaken competition in the market.
“We do think Alliance will be a good investment. It has been a very good investment for Qantas [so far] – we now will have 18 E190s operating on wet lease. Over half their revenue comes from Qantas,” he said.
“We think there is a huge benefit to customers in the fly-in, fly-out and charter market, and we’re talking to our customers about that. Once we have a decision on what our next steps are, we will inform the market at that stage.”
The consumer and competition watchdog last month knocked back the deal after four delays, saying that allowing the merger to go ahead would likely substantially lessen competition, thus threatening “increased prices and reduced service quality” for resource industry customers in WA and Queensland.
“Qantas and Alliance currently strongly compete with each other in markets where there are few effective alternatives. The proposed acquisition would combine two of the largest suppliers of charter services in Western Australia and Queensland,” said ACCC Chair Gina Cass-Gottlieb.
“Flying workers in the resource industry to and from their worksites is an essential service for this important part of the Australian economy, so it is critical that competition in this market is protected.”
Earlier this month, the ACCC also denied a request for Virgin and Alliance to continue to collaborate, meaning the two airlines can no longer jointly tender for mining companies’ contracts and must quickly unwind their current deal.
Since then, Rex-owned rival FIFO operator National Jet Express has announced an expansion into the Alliance heartland of Queensland after signing a deal with mining company BHP Mitsubishi Alliance.
NJE will purchase two Dash 8-Q400NG aircraft to service the market and is slated to start operations in the Sunshine State as soon as 1 July. Rex purchased NJE last year for $48 million after the Flying Kangaroo announced its bid for Alliance.
