Plans for more Qantas flights to US at risk after airline withdraws application to expand collaboration with American Airlines

Non-stop flights of Australian flag carrier are experiencing some turbulence. Besides the threat to the Perth-London direct flight due to problems with operators of Perth Airport, Qantas just withdrew its application with the US Department of Transportation to collaborate with American Airlines.

The first to be affected is the Sydney-San Francisco route whose long-term viability is at risk. The first non-stop flight took place 10 years in March 29, 2006 when a Qantas B747-400 arrived at San Francisco’s international airport.

Qantas recently restarted the service, flying six days a week on flight QF74 using its B747 jet and added trips to Dallas. American Airlines, in turn, began new flights between Los Angeles and Sydney and Los Angeles and Auckland, Business Insider Australia reports.

Following the denial by the US Department of Transportation of the application by Qantas and American Airlines for antitrust immunity, after 17 months of consideration, the two withdrew it, Daily Telegraph reports. Besides affecting the viability of current routes, the withdrawal would likely affect plans for collaboration on new routes.

Australian and New Zealand regulators have approved the antitrust immunity since 2011 based on their expanded partnership not being detrimental to passengers and would even deliver benefits for consumers. While the withdrawal would not affect existing codeshare agreement between the two air carriers, Qantas and American Airlines would need to assess their trans-Pacific networks, the Qantas spokeswoman says.

The DoT rejected the antitrust immunity application after it analysed traffic data, passenger bookings and other evidence. Based on its analysis, the agency says an expanded alliance could potentially create anti-competitive environment. The expanded collaboration would have set prices for seats sold in the US that account for 60 percent of capacity between Australia and the US.

Qantas was planning a Sydney-Chicago route in the next few years with the arrival of its Boeing 787-9 jet by late 2017. The development also could affect the Flying Roo’s plant to fly to new American cities such as Seattle, Houston and Chicago based on American Airlines opening new gateways with the cancelled expanded collaboration.