Not everyone was celebrating when Qantas expanded its trans-Pacific relationship with American Airlines last month or when Virgin extended its partnership with Delta by another five years.
While codesharing agreements are often seen as a positive for consumers, Hawaiian Airlines boss, Mark Dunkerley, said they’re actually having the opposite effect.
Speaking at the CAPA Aviation Summit this week, Dunkerley explained that codesharing agreements between US and Australian airlines are likely to hurt travellers by driving up airfares.
Mark Dunkerley says alliances could increase airfares.
He argued that joint ventures between US and European carriers had significantly increased prices on trans-Atlantic routes and the same could occur on the trans-Pacific.
Citing statistics from 2000 onwards, Dunkerley demonstrated that the percentage of trans-Atlantic traffic on anti-trust immunity carriers had risen to 87 percent from 41 percent. In the same period, the average fare price, adjusted for inflation, rose by 22 percent.
He urged regulators in all markets, including Australia’s Competition and Consumer Commission to ‘really think’ about policy or potential changes to policy that could increase market dominance by alliances.
Hawaiian Airlines recently objected Qantas’ expanded relationship with American Airlines.
“It is going to be bad for the consumer to a degree even more pronounced than seen in Europe due to the remote geography of the Pacific and the nature of the demographics.”
Mark Dunkerley, Hawaiian Airlines CEO
Hawaiian Airlines recently lodged a submission to the ACCC objecting the expansion of Qantas and American Airlines’ alliance, which would see Qantas codeshare on AA flights to LA while Qantas moves its aircraft on services to San Francisco.
