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American-Qantas Joint Venture approved (19 July 2019)

American-Qantas Joint Venture approved (19 July 2019)

Old Jun 2, 19, 10:31 pm
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American-Qantas Joint Venture tentatively approved (2 Jun 2019)

Several sites reporting


​The U.S. Transportation Department is expected to provide tentative approval to a bid by American Airlines and Qantas Airways to operate a joint venture, two people briefed on the matter said on Sunday.

The department is expected to issue an order tentatively approving the joint business agreement and tentatively granting antitrust immunity, according to the sources, who spoke on condition of anonymity.
​​​​​​
https://www.cnbc.com/amp/2019/06/03/...s-venture.html

Could this mean more AA metal expansions?

Last edited by JDiver; Jul 19, 19 at 4:15 pm Reason: Restore original post title
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Old Jun 3, 19, 4:58 am
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Please put the 773 back on the route so I can purchase business class tickets and get some use out of my SWUs
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Old Jun 3, 19, 6:07 am
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Another blow to competition - apparantly a cartel is just what is needed
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Old Jun 3, 19, 7:57 am
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"would let them coordinate prices and schedules, threatening to cancel services if it was rejected and arguing it could "unlock" up to $310 million annually in consumer benefits......"

Unlock $310 million in consumer benefits! This should be interesting.
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Old Jun 3, 19, 9:32 am
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Originally Posted by bobnchi View Post
"would let them coordinate prices and schedules, threatening to cancel services if it was rejected and arguing it could "unlock" up to $310 million annually in consumer benefits......"

Unlock $310 million in consumer benefits! This should be interesting.
Time to scale back consumer benefits by about, oh $310 million.
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Old Jun 3, 19, 10:20 am
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Well on the bright side since looking at this negatively is way too easy (lol), I would reckon that as with the other JV Partners, AA should align earnings on fares, so I am guessing that B/C accrual should go on eligible QF marketed flights up to 2x EQM up from 1.5x etc. At least that would be nice!

Safe Travels
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Old Jun 3, 19, 10:32 am
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Originally Posted by Antarius View Post
Several sites reporting
​​​
https://www.cnbc.com/amp/2019/06/03/...s-venture.html

Could this mean more AA metal expansions?
Originally Posted by 3544quebec View Post
Please put the 773 back on the route so I can purchase business class tickets and get some use out of my SWUs
I would think that they would switch an AA 77W route from another one and reintroduce it on the LAX-SYD route. It would be too much to hope for to see additional 77Ws orders, or even considering all new 77X orders.

IIRC, there was some preliminary conversations between AA and QF to consider allowing each others upgrade instruments (i.e. AA SWU) to be used on each others metal, but those ended when the original JV application was denied.
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Old Jun 3, 19, 10:45 am
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Sydney Morning Herald has an article as well. Link.

American Airlines is confident the US transport regulator will soon decide whether to approve a proposed joint-venture with Qantas, which the airlines claim will give flyers $400 million a year in benefits...through connections to more destinations on each others' networks and access to cheaper fare classes when code-sharing.

They... share revenue and marketing costs on each others' Trans-Pacific flights.
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Old Jun 3, 19, 10:55 am
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Originally Posted by 3544quebec View Post
Please put the 773 back on the route so I can purchase business class tickets and get some use out of my SWUs
Or what will be a chance AA will do same as what happened to JFK-NRT/HND? AA discontinued JFK-NRT on own metal, have JL fly their metal and AA will simply code share. True, no use of SWUs on non-stop JFK-NRT/HND but possible that AA is selling more revenue F ticket on JFK-NRT/HND this way
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Old Jun 3, 19, 12:47 pm
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I feel this will also lead to less AA metal overall, but I guess we have to wait and see.
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Old Jun 3, 19, 12:50 pm
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Will be increased/better AA metal/routes
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Old Jun 3, 19, 12:57 pm
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From the CNBC article Antarius posted:

Qantas said last year the joint venture would allow the two airlines to "significantly improve service" and "stimulate demand." The airlines said the agreement could generate up to 180,000 new trips between the United States and Australia and New Zealand annually.

Maybe I'm dumb or I wasn't paying attention that day in Master's program in business school. Can someone explain how a joint venture stimulates demand?

Last edited by writerguyfl; Jun 3, 19 at 12:59 pm Reason: Fixing spacing.
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Old Jun 3, 19, 2:08 pm
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There seems to be overcapacity on USA-Australia routes, especially LAX-SYD. At least during the southern hemisphere winter. If the JV goes ahead, it could result in AA cutting LAX-SYD, making it less than daily, or making it seasonal. This talk about "significantly improve service" and "stimulate demand" is just lip service - the airlines saying whatever they think regulators want to hear to get approval.
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Old Jun 3, 19, 2:24 pm
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Originally Posted by Austin787 View Post
There seems to be overcapacity on USA-Australia routes, especially LAX-SYD. At least during the southern hemisphere winter. If the JV goes ahead, it could result in AA cutting LAX-SYD, making it less than daily, or making it seasonal. This talk about "significantly improve service" and "stimulate demand" is just lip service - the airlines saying whatever they think regulators want to hear to get approval.
Just curious, how do you figure? It seems like the airfares are some of the highest to any destination between the US and a LH destination anywhere "popular" in the world.. That would indicate to me that there is a comparative lack of competition vs. many other destinations.
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Old Jun 3, 19, 2:28 pm
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Originally Posted by writerguyfl View Post
From the CNBC article Antarius posted:

Qantas said last year the joint venture would allow the two airlines to "significantly improve service" and "stimulate demand." The airlines said the agreement could generate up to 180,000 new trips between the United States and Australia and New Zealand annually.

Maybe I'm dumb or I wasn't paying attention that day in Master's program in business school. Can someone explain how a joint venture stimulates demand?
I speculate they are implying prices will be lower, resulting in more demand.

Now, how true this is, that's up for debate.
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