6-Fold Rise in Qantas’s Europe Bookings After Emirates’s Alliance; Fares Down by Average of $100
Qantas reported on Monday a six-fold rise in its Europe booking following its recent alliance with Middle Eastern carrier Emirates. The Australian flag carrier explained the higher bookings to shorter flight times between Europe and the Asia-Pacific.
From Melbourne and Sydney, the average trip to top 10 European destinations was shortened by over two hours because of just one stopover in Dubai.
The alliance, which was the result of Qantas severing ties with former partners, is part of the airline's strategy to return to profitability for its international operations after it reported in 2012 its first annual loss since 1993.
Including its European trips, Qantas passengers could fly to 65 international destinations with just one stop in Dubai compared to only five one-stop destinations to Europe under its old tie-up with the International Consolidated Airlines Group which is a unit of British Airways.
Andrew Gibson, an analyst for Goldman Sachs, estimated the tie-up worth at $94 million a year before tax to Qantas because it fills more seats on combined trips to Europe, New Zealand and Southeast Asia, while dropping the unprofitable Frankfurt route.
On news of the Qantas-Emirates deal, which was approved in March by the Australian regulator, shares of the flag carrier went up 20 per cent in 2013 while the benchmark S&P/ASX 200 increased by only 6.8 per cent.
Besides the lesser flying time, Qantas passengers also enjoy an average decrease in their ticket cost by $100 due to the alliance due to lower transit fees, landing fees and extra flight charges.
Qantas Chief Executive Alan Joyce promised Qantas flyers that the air carrier would review all its fares and align them and decide on an appropriate price in the various routes it serves.