Friday, August 19, 2011

British Airways and Qantas in Strategic Alliance

Qantas and British Airways have decided to restructure their long-running Joint Services Agreement (JSA), which will allow both airlines to strengthen their Singapore hub and to provide better connections, products and services to travellers who book flights between London Heathrow and Australia.

Australia’s Qantas will continue its Airbus A380 services from Melbourne and Sydney to London via Singapore, while UK’s flag carrier, British Airways will upgrade its London-Singapore-Sydney operations from a Boeing 777 to Boeing 747. Qantas will also build a new premium lounge at Singapore’s Changi International Airport.

The restructured JSA will consolidate Singapore’s standing as the primary hub in the partnership between both these carriers and will offer them an upper hand in the competitive position in the Asia-Pacific market.

Qantas has announced a five-year plan to stay relevant in the current global airline business, and these JSA developments are part of that plan. The Qantas Group also announced the launch of budget airline for the Japanese market, Jetstar Japan that promises to offer cheap flight tickets. The group has collaborated with Japan Airlines and Mitsubishi Corporation to bring out this new low-cost carrier that will serve travellers who go for cheap tickets on flights.

When it comes to the restructured JSA between Qantas and British Airways, it has been decided that from the start of the year 2012 Qantas will offer flights on Australia-Bangkok and Australia-Hong Kong routes, whereas BA is scheduled to provide Bangkok-London and Hong Kong-London operations.

Qantas will cease its Bangkok-London and Hong Kong-London services and British Airways will conclude its Bangkok-Sydney operations. This is done to aim at maximising the carrier’s respective operational strengths. It has also been announced that BA will increase the frequency of London-Hong Kong flights from 14 per week to 17 per week.

Qantas CEO Alan Joyce observed that it was an opportune time to enhance the Joint Services Agreement.

“Strengthening our relationship with British Airways is an important element of our new strategy for Qantas International,” Mr Joyce was quoted in the company’s press release.

“Singapore will become the focal point of the JSA relationship, with daily Qantas A380 services from Melbourne and Sydney and onward to London, increased British Airways capacity and a new premium lounge.

“The new approach is a smarter use of both airlines’ resources that will enhance our competitive position in Asia and in the Australia-Europe market.

“Regardless of which airline is operating flights between Australia and the United Kingdom, we are focused on delivering a smooth and enjoyable flying experience for passengers. Restructuring the JSA will put us on the front foot in the fiercely competitive Australia-UK air travel market,” Mr Joyce further added.

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