American Airlines/Qantas JBA to ‘substantially’ improve quality of travel to Australasia region

    American Airlines and Qantas, in a submission to the US Department of Transportation (US DoT), filed (04-Dec-2018) a joint response to answers concerning their application for antitrust immunity (ATI) for their proposed trans Pacific joint business agreement (JBA). The carriers said the proposed JBA is expected to provide the following benefits:

    • Generation of consumer benefits valued at up to USD310 million p/a, stimulating additional demand of 180,000 new passengers p/a;
    • “Substantially” improve quality of travel to the Australasia region;
    • ATI refusal risks “significant loss” of connectivity, putting important routes at “significant risk” including Qantas’ Sydney-Dallas/Fort Worth service which is estimated to generate USD133 million in consumer benefits p/a.

    The carriers argued revenue pooling JBAs result in connecting fares close to 8% lower than interline/codeshare fares and nearly as low as airfares for online connecting service on a single carrier. They also noted “widespread support” for the JBA, which has been approved by regulatory authorities in Australia and New Zealand. US DoT received signatures from 1138 supporters across constituencies, including 64 US state and local officials, 17 airports, 825 travel agents, 45 business associations, 87 individual corporations and 26 other non profits, universities and organisations from 37 US States and 28 countries in the Americas and Australasia. The carriers concluded no party has identified any specific consumer harms likely to result from the JBA, with only JetBlue proposing the US DoT limit its ATI grant for three to five years with a renewal requirement thereafter. [more – original PR]