Qantas and JAL lose the fight for joint venture

SYDNEY, 14 September 2021: Qantas and Japan Airlines have declared their disappointment at the Australian Competition and Consumer Commission’s (ACCC) decision to block the airlines’ plans to form a joint business.

Both airlines claimed the tie-up would have boosted tourism recovery when international borders reopened. They had sought approval from the ACCC in December 2020 to work more closely together to “better serve customers travelling between Australia, New Zealand and Japan and ensure a faster and sustained recovery from Covid-19”.

The proposed joint business venture would have expanded codeshares up to 29 destinations and synchronised flight schedules between Australia, New Zealand and Japan that would have saved costs for the airlines.

In addition, their presentation to the ACCC included establishing a new direct route from Cairns to Tokyo operated by Qantas.

ACCC rules on business pacts that could ultimately impact consumers through reduced competitiveness in the market.

Qantas and JAL will continue their existing codeshare and oneworld partnership, but lacking some of the benefits that would have been possible under a joint business. Qantas and JAL have been partners in Jetstar Japan, one of the largest domestic low-cost carriers in Japan, since 2012.

Qantas Domestic and International CEO Andrew David commented: “We’re obviously disappointed with this decision. A closer partnership between Qantas and Japan Airlines would have meant more routes, better flight connections and more benefits to frequent flyers. None of these benefits will be realised following the ACCC’s decision.

“This is particularly unfortunate for Queensland and Cairns, which would have benefited from a direct Qantas route to Tokyo. Without being able to coordinate with JAL, and in particular to draw Japanese tourists into northern Queensland using JAL’s extensive marketing reach in Japan, the planned flights between Cairns and Tokyo are just not commercially viable for Qantas.”

JAL executive officer, senior vice president Ross Leggett added: “Japan Airlines is also truly disappointed with the ACCC’s decision to disapprove our proposed joint business. We especially believed that the joint business with Qantas would have accelerated the recovery of leisure and business traffic between Japan and Australia.”