Qantas Airways and American Airlines will now be able to proceed with their Joint Business Agreement, after official approval of the deal was granted by the US Department of Transportation.
In a ‘Final Order’ just issued, the DoT says that based on its evaluation of the application “we determine that approving the JBA would likely promote inter-alliance competition in the US-Australia and US-New Zealand markets and produce a stronger overall competitive environment, leading to enhanced consumer benefits”.
A number of minor conditions apply to the approval, including a requirement to report on the JBA on an annual basis, and confirmation that a separate approval would be needed if AA/QF ever wanted to operate under a common name.
The DoT specifically noted Qantas and AA’s stated intentions to support and expand the newly launched Qantas nonstop services, implement product enhancements, and “invest in joint-use facilities”.
A key factor in the decision is increased competition between airline alliances across the South Pacific, where United and Air NZ have operated with immunity for 10 years and the Delta-V Australia joint venture received approval this year.
“Approving the AA/QF JBA will allow these oneworld carriers to deepen their cooperation, compete more effectively with the existing immunized carrier groupings, and create and sustain consumer benefits,” the ruling says.
More information in today’s Travel Daily.