QATAR AIRWAYS: Australian Government rejects expansion on Australian routes. Win for Qantas.

The Australian Financial Review (AFR) is reporting that Transport Minister Catherine King has said in response to Qatar Airways June application to increase its routes to Australia, that:

“The Australian government is not considering additional bilateral air rights with Qatar.”

Catherine King, Transport Minister

… thus dashing hopes from consumers that increased competitive capacity would put some much-needed downward pressure on airfares, including Qantas to decrease it would put pressure on Qantas.

The ministerial response is in a 10 July letter from Transport Minister Catherine King to the women who are suing Qatar and others over an invasive search incident at Doha Airport in 2021.

That news will be good for Qantas, ensuring less competitive pressure from this middle east carrier, which has predicted that restrictions on capacity across the airline industry will see it charging higher than average airfares for the next five years.

Background

Qatar Airways has long wanted to increase its presence on routes to Australian capital cities. Of course, it wanted to increase its flights to the East Coast. It currently runs twice daily flights out of Melbourne and single daily flights from Adelaide, Brisbane Perth and Sydney. Qatar’s request would have seen one additional daily service from Brisbane, Melbourne, Perth and Sydney. Granting that increase would put them level with the frequency of service airlines like Cathay Pacific, Emirates and Singapore Airlines offer.

At the time of writing the schedule stands at double-daily flights from Melbourne, and one daily service from Sydney, Brisbane, Adelaide and Perth.

However, the Qatari flag carrier had been seeking to add one extra daily flight each for Sydney, Melbourne, Brisbane and Perth, which would lift it closer to the levels long enjoyed by the likes of Cathay Pacific, Singapore Airlines and Emirates.

For

Putting downward pressure on inflated airfares at the moment would be something that all travellers would applaud. The additional daily flights requested by Qatar would add considerable capacity to the Australian market, making it more competitive, and with more flights and seats, prices should stabilise, and hopefully reduce.

This would also be a reward for Qatar which kept flying to Australia throughout the pandemic even when Qantas cancelled all international flights. Qatar was also instrumental in providing repatriation flights for Australians stuck all over the world during the pandemic lockdowns. Qatar also contributed to the evacuation of Australians when Kabul in Afghanistan fell to the Taliban in August 2021.

The AFR is also reporting that the affected State Governments have supported the increase in flights.

Against

Qatar Airways is the focus of a class action by a group of women who were taken off a Qatar flight in Doha and invasively searched. The cause was the finding of an abandoned newborn in a rubbish bin in one of Doha’s airport toilets. Doha is the home airport of Qatar Airways. The affected women who are party to the lawsuit have opposed the expansion. Although Qatar was involved, It points the finger at the Airport and Qatar police as the authorities responsible for the human rights abusing searches.

Despite the support of many state premiers eager to see a return of volume to inbound tourism some in the industry express concern that such an increase could ‘destabilise’ the industry, especially as other airlines increase their capacity. I read that term ‘destabilise’ means continued downward pressure on the price of airfares as capacity suddenly increases.

2PAXfly Takeout

Qatar Airways is a OneWorld member, linking it to Qantas, and a partner of Virgin Australia. Qantas and Qatar, despite sharing a mutual first letter of their names, and both being members of the same airline alliance, have had a somewhat tense relationship over the last few years. Or at least their CEOs – Alan Joyce for Qantas, and Akbar Al Baker, CEO of Qatar Airways have.

This current move indicates that Qantas has won the latest skirmish. We await an official public statement from the Transport Minister to confirm that the Qatar Airways request for an increased number of flights has been refused.

Looks like Qatar might have to return to its Canberra to Doha flights via Sydney to increase its Australian capacity.