The Australian Competition and Consumer Commission (ACCC) has blocked plans for a joint business between Qantas and Japan Airlines.
The airlines sought approval from the ACCC in December 2020 to work more closely together when operating services between Australia, New Zealand and Japan.
The agreement included:
- An expanded codeshare relationship to up to 29 destinations and better flight schedules between Australia, New Zealand and Japan
- A new direct route Cairns – Tokyo operated by Qantas
- Coordination of pricing, schedules, sales and tourism marketing supporting growth in key tourism markets
- Enhanced frequent flyer benefits and more premium travel opportunities for Qantas and JAL customers
Qantas says it will continue its existing codeshare and oneworld partnership with Japan Airlines, however these don't provide the same benefits as what would have been possible under a joint business.
Qantas and Japan Airlines have been partners in Jetstar Japan, one of the largest domestic low cost carriers in Japan, since 2012.
In 2019 half a million Japanese residents visited Australia, meaning it is one of the largest tourism and corporate markets.
Qantas Domestic and International CEO Andrew David said both parties were disappointed by the decision.
"A closer partnership between Qantas and Japan Airlines would have meant more routes, better flight connections and more benefits to frequent flyers. None of these benefits will be realised following the ACCC's decision.
"We know the recovery of international travel is going to be slow and bumpy. It will take years for the whole travel and tourism industry to fully recover from COVID, so getting the policy settings right is going to be critical as key routes are rebuilt essentially from scratch. Getting that right will ultimately benefit the recovery of the Australian economy," David said.
The decision is also bad news for Queensland and Cairns, which would have benefited from the direct Qantas route to and from Tokyo.
Qantas says without being able to coordinate with Japan Airlines, and in particular to draw Japanese tourists into northern Queensland using the airline's extensive marketing reach in Japan, the planned flights between Cairns and Tokyo are no longer commercially viable for Qantas.
The Australian airline plans to recommence international flying in November.