Qantas shelves plan for premium Asian-based airline with MAS

By David Flynn, March 9 2012

Qantas appears to have grounded its proposed Asian-based premium airline even before it launched.

Qantas CEO Alan Joyce has cancelled plans to establish the new premium airline, which was tipped to be branded Red Q or OneAsia (although wags were quick to christen it 'Qantasia'), as a joint venture with Malaysia Airlines.

In a statement, the airline said that "discussions with Malaysia Airlines on a partnership including the establishment of a premium airline would not continue due to the parties being unable to reach mutually agreeable commercial terms."

The statement also cited "global economic uncertainty" as a reason for caution.

And while leaving the door open to other joint ventures and alliances in the Asian region, Qantas "will allocate minimal capital to such ventures".

In Qantas' half-yearly report in February this year, Alan Joyce made clear his desire to rely on "a capital-lite model for any premium airline investment in Asia."

Mockup by Australian Aviation
A livery that'll never see the light of day..?
Mockup by Australian Aviation

Joyce had previously promised the new airline would "offer same-day services to and within Asia, and overall frequencies from Australia to Asia will grow. For the first time in our history, Qantas intends to fully participate in the benefits of an Asian hub."

Qantas was also splashing out on new fuel-efficient Airbus A320 aircraft for the premium airline, in which it was to hold a 49% stake alongside yet-to-be-named partners.

With Red Q now on the ice, Qantas will likely accelerate its alliance with Malaysia Airlines which would encompass code-sharing of flights as well as frequent flyer point sharing and reciprocal lounge access.

MAS is expected to join the oneworld airline alliance in late 2012, however, speaking with Australian Business Traveller earlier this year, Qantas' Head of Airline Loyalty Stephanie Tully said "we will aim to do the frequent flyer agreement earlier".

Coincidentally, Malaysia Airlines overnight confirmed plans to launch an Airbus A380 service between Sydney and Kuala Lumpur later this year.

David
David

David Flynn

David Flynn is the Editor-in-Chief of Executive Traveller and a bit of a travel tragic with a weakness for good coffee, shopping and lychee martinis.

AusFlyer

AusFlyer

10 Mar 2011

Total posts 531

Much smarter move for Qantas to focus on partnerships and code shares rather than starting a new airline. 

AlG

AlG

04 Nov 2010

Total posts 674

Agree with AusFlyer, this is NOT the time for Qantas to be trying to launch a NEW airline even as a joint venture unless it's done very low-cost and even then thereis a lot more risk compared to sticking with what you already have and working that batter, eg alliances.

I'm sure that QF would look at all sorts of fancy ways to make this work for the bean-counters like having a JV buy the planes and then leasing them back to Qantas or some such, but the bottom line is that right now they need to stick to their knitting!

mattdc

mattdc

12 Jul 2011

Total posts 76

I wonder what they'll do with the order for all those A320's. Keep the order or cancel it?

AlG

AlG

04 Nov 2010

Total posts 674

Watch for them to appear on the Qantas Frequent Flyer store. "Own your own private jet! Brand new Airbus A320, only 100 million points! (Delivery and handling fee applies)"

Dunc

Dunc

30 Sep 2011

Total posts 43

As a business man it never felt right getting in bed with a competitor code share or alliance especial if they still flew in direct competition with you i.e. Kangaroo route. We have cut back on QANTAS over the years as the reduced their lights to Rome,PAris etc. Changing planes is one thing but changeing airlines that's something else. It's like their tie up with Airfrance you get status to Singapore and that's it let alone how crapy Air France is unless you are in first and then their are better. When the 787 was announced I thought they use the truck (A380) to say Singapore then use smaller planes (787) to go onward but to two different destinations say Singapore , Rome Paris. HK then Bejing, Seoul. Using LHR as their European hub is useless then fly back to Spain, Italy, Austria, Czech forget it this is where the middle eastern carriers win for me and a lot of business people I know. The factories of europe are in the east, Turkey, Hungry even Egypt etc.. Looks like he gaves us Jetcrap now we are going to get Qantrap


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