Elephant in the room [AusBT coverage of Qantas/AA Joint Venture]

17 replies

TheRealBabushka

Member since 21 Apr 2012

Total posts 2,059

I'm in two minds about writing this, vacillating between dismay at the lack of coverage and curiosity as to why this story is not a priority. 

So here goes!

On the subject of the DOT blocking the AA and QF joint venture expansion, the following leading sites have reported and provided commentary:

  • Onemileataitime reported on 18 Nov 2016
  • Flyertalk reported on 21 Nov 2016
  • Business Traveller (UK) reported on 21 Nov 2016

To date there are no reports from this site.

Given the possible impact to AU based travellers, the following questions arises:

  • What does this mean for the current JV
  • Is QF and AA forced to compete now, thereby lowering prices?
  • What does this mean for connection to the US and Australia?
  • Will there be fewer connections to AA ports with QF codes and vice versa, thereby impacting the ability to earn SC/EQD
  • To what extent will this be a problem for QFF/Aadvantage members?
  • What will change and what will not change?
  1. Does AUSBT intend to tackle this or is the intention to be a passive recipient and outlet for media briefings by QF and AA's communication & media relations department?
  2. Unpacking this for readers, peppered with off-the-record comments from QF and AA sources would, in my opinion be very much sought after.
  3. Fair enough if editors of AUSBT does not consider these types of stories to be its focus - Such admissions would merely confirm my feelings as to the direction that this site has taken of late (this is not negative or positive - it is what it is).

Poll: Who thinks AUSBT should tackle the DOT AA/QF ruling?

Grannular

Member since 31 Mar 2014

Total posts 191

My understanding is that a tentative ruling has been made, not a final ruling. DOT has provided a Show Cause Notice, so AA and QF still have the ability to provide further information to sway the final ruling. 

Based on this, it is my view that ABT is actually waiting on the issue being finalised, instead of reporting on something that may in fact, go ahead.

freshthoughts

Qantas - Qantas Frequent Flyer

Member since 08 Aug 2016

Total posts 112

view from the wing, also wrote about this topic just in a different view.

http://viewfromthewing.boardingarea.com/2016/11/19/will-donald-trump-save-americans-flights-sydney-auckland-now-dot-ruled-qantas-joint-venture/

TheRealBabushka

Member since 21 Apr 2012

Total posts 2,059

My understanding is that a tentative ruling has been made, not a final ruling. DOT has provided a Show Cause Notice, so AA and QF still have the ability to provide further information to sway the final ruling. 
Based on this, it is my view that ABT is actually waiting on the issue being finalised, instead of reporting on something that may in fact, go ahead.

I understand what you are saying but I find it interesting to preclude the opportunity to discuss the pros and cons of antitrust immunity being revoked before the case is finalised.

What is the disadvantage to this site for facilitating such a discussion?

In whose interest is it for this case not to be aired in a public forum?

Does this not go to the heart of what this site is for?

David

Member since 24 Oct 2010

Total posts 988

TRB: no drama on your post, this is all part of what the community is for

The reason we've not reported this is simply because there's nothing to report right now that would impact our audience. The DoT's call is a tentative one, and it's a call which Qantas and American are of course appealing against. Once a final call has been made we'll be in a position to examine the actual impacts and report accordingly.

This also plays back into the broader theme of Australian Business Traveller's content strategy – the types of stories we run and also what we don't run. We lean towards content that's useful, practical, actionable... doesn't always happen (there's also room for pieces more of interest and 'colour'), but right now the QF/AA/DoT JV is simply a non-starter.

Last editedby David at Nov 23, 2016, 05:38 PM.

hutch

Member since 07 Oct 2012

Total posts 761

Huh?! If Ausbt wants to write something about AA/QF being given 'show cause' that is up to them. I don't recall them writing something about ACCC doing the same thing about the China Eastern/QF deal and then ending up approving it following further lobbying (maybe they did, but I don't recall). 


I would prefer they leave it until a final decision is made, but if they mentioned it beforehand then so be it. I think you need to lose the sense of entitlement. We don't pay anything to be here. If you enjoy reading the articles on the other sites then they are an option to you... plus there are frequent flyer forums as well. 


David

Member since 24 Oct 2010

Total posts 988

In whose interest is it for this case not to be aired in a public forum?

Does this not go to the heart of what this site is for?


Those are some reasons why we launched the community: to 'facilitate' these discussions without needing an AusBT article to kick things off.

Last editedby David at Nov 24, 2016, 11:03 AM.

Mal

Member since 14 Jun 2013

Total posts 109

Talk about clickbait, I came here expecting to read a thread about an actual elephant sitting in a room somewhere!


Can't see the beef myself, everything that has been mentioned in the first post is all 'possible impact' and 'what if?'. Makes no sense for ABT to write any of that up until the JV issue has been decided one way or the other.

Tim Saunders

Member since 13 Sep 2016

Total posts 30

I don't see any hidden agenda in AusBT's decision not to cover this hiccup in the QF/AA joint venture, as David has clearly stated it's just not really a story right now, or at least not the sort of story which AusBT does. If the joint venture is in the end blocked then I am sure AusBT will do its usual good job of providing a detailed breakdown of what this means to travellers, probably better than you will find on any other website.

TheRealBabushka

Member since 21 Apr 2012

Total posts 2,059

Talk about clickbait, I came here expecting to read a thread about an actual elephant sitting in a room somewhere!

Can't see the beef myself, everything that has been mentioned in the first post is all 'possible impact' and 'what if?'. Makes no sense for ABT to write any of that up until the JV issue has been decided one way or the other.

Clickbait! Good one! LOL

Damien00

Qantas - Qantas Frequent Flyer

Member since 25 Feb 2016

Total posts 26

For me I don't really understand what the JV's all about... how it it different from a normal code-share arrangement, what benefits it has for both the airlines and me the traveller and what is the sticking point for the the DOT in approving it. What changes between today and the the JV being approved/denied etc?


Personally an article explaining all that is going on and whats at stake would be - necessary, no - interesting, very. Obviously with a follow-up when the final decision is known.

Just my thoughts.

watson374

Qantas - Qantas Frequent Flyer

Member since 17 Aug 2012

Total posts 1,285

For me I don't really understand what the JV's all about... how it it different from a normal code-share arrangement, what benefits it has for both the airlines and me the traveller and what is the sticking point for the the DOT in approving it. What changes between today and the the JV being approved/denied etc?


Revenue-sharing, product alignment, etc.

Himeno

Member since 12 Dec 2012

Total posts 289

For me I don't really understand what the JV's all about... how it it different from a normal code-share arrangement, what benefits it has for both the airlines and me the traveller and what is the sticking point for the the DOT in approving it. What changes between today and the the JV being approved/denied etc?

Personally an article explaining all that is going on and whats at stake would be - necessary, no - interesting, very. Obviously with a follow-up when the final decision is known.

Just my thoughts.

The current QF/AA agreement is closer to the QF/JL (JP-AU codeshare via SIN) or old QF/SA agreement. They want to make it more like the old QF/BA or current QF/EK agreements.

GBRGB

Qantas - Qantas Frequent Flyer

Member since 21 Jan 2014

Total posts 250

I agree with TRB, there are many discussions on here regarding what could happen, should happen with a variety of subjects and the impacts of decisions one way or another, the initial decision by the DOT was one I found interest in and followed on general media outlets and I was a bit surprised it wasn't reported on here. 

TheRealBabushka

Member since 21 Apr 2012

Total posts 2,059

As reported in The Age on 29 Nov 2016. Qantas has decided to pull the plug:


As per the Qantas spokesperson:

"It follows approval from Australian and New Zealand regulators on the basis that our expanded partnership involved no detriment and would deliver significant benefits for consumers"

Key questions: How effective are the AU regulators if they approved this deal while the DOT hasn't? What is the AU regulator's focus? Is their focus different from the DOT?

As per the AA spokesperson:

"With that opportunity we would have been able to compete more effectively and increase consumer benefits in the market as well."

Code: We can compete on quality and not price.

It is well known that the Trans Pacific sector is one of the last few international sectors making money for Qantas. AA and other US-based airlines know this and want to get in on the action. The application of game theory on the part of AA and QF is commendable. Question is how will AA react to this so that they do not haemorrhage cash and wind down the Trans Pacific strategy without losing too much face?

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