Qantas dumps British Airways for Emirates partnership

Sep 6, 2012

Australian airline seeks to boost flagging fortunes through ten-year flight-share deal


QANTAS has announced a ten-year partnership with Emirates Airways, describing the new venture as "the biggest arrangement" in the airline’s history.

The deal, which is expected to begin from April 2013, will see the two companies co-ordinate pricing, sales and schedules, The Australian reports.

Qantas will also move its hub for European flights from Singapore to Dubai. This will allow the Australian airline to operate daily flights from both Sydney and Melbourne to London via the Gulf, cooperating with Emirates to chart 98 weekly services along these routes.

Qantas currently holds a less extensive partnership with British Airways. This 17-year alliance will end on March 31 2013 to make way for the new deal.

The announcement comes as Qantas seeks to revive its flagging fortunes after last month announcing its first annual loss since privatisation in 1995.

Slowing demand, growing competition and rising fuel costs were said to have contributed to a net loss of AU$244m (£161m) for the year to 30 June.

According to Qantas chief executive Alan Joyce, a key objective of the deal will be "to make Qantas strong and viable, and bring it back to profitability".

The deal will also boost the Australian economy, Joyce predicts, as Qantas collaborates with industry to drive more inbound trade and tourism.

The Guardian notes that Qantas’ new partnership will allow it to cut loss-making international routes and focus on its profitable domestic and budget operations.

Emirates also stands to benefit through better access to the Australian domestic network of more than 50 destinations and nearly 5,000 flights per week, allowing it to compete against its main Abu Dhabi rivals Etihad Airways and Qatar Airways.

After news of the deal broke, Qantas shares soared by 6.2 per cent to AU$1.19.

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