Qantas slams code-share demand over South Africa route

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This was published 12 years ago

Qantas slams code-share demand over South Africa route

By Matt O'sullivan

QANTAS has warned aviation authorities that putting an end to its tie up with South Africa Airways for services between Australia and Johannesburg is likely to lead to one of the airlines pulling off the route.

The International Air Services Commission has told the two airlines - which hold a duopoly on direct services to South Africa - that it is unlikely to extend its approval of their code-share beyond the end of the year.

It has also proposed a condition of their existing tie up that they operate 14 flights a week between them, so as to stop the airlines from "reducing capacity in order to cut costs and drive up load factors and fares".

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But in a strongly worded response, Qantas said the withdrawal of approval at the end of the year would "likely result in monopolies for direct services on both the Sydney and Perth routes" to South Africa.

Qantas criticised the commission's stance that services were unlikely to change if the deal was not extended, insisting"it is more likely that one or more of the incumbent carriers will reduce services or withdraw entirely from the route". Qantas wants the commission to approve the tie up for five years.

The two airlines' stranglehold on direct flights on the route have been a point of contention for a number of years for both the air services commission and Australia's competition watchdog.

But South Africa Airways has also warned the commission that it is losing money on the route, which has been "constrained by … uncertainty in global markets".

The airline said it was making a small profit on its own flights between Johannesburg and Perth but losing money on the Qantas flights it code shares on between Sydney and South Africa.

The commission wants South Africa Airways to increase its flights to Perth from six to seven a week but the airline has warned that doing so would be "exceptionally difficult".

The commission has allowed the code-share between the airlines since 2000, but more recently has only extended approval for one to two years because of concerns the tie up may not benefit passengers.

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