Qantas pulls the pin on yet another planned partnership

The alarms keep sounding at Qantas head office, with the carrier now forced to walk away from a proposed pact extension with China Eastern Airlines - the second big deal to fall through in as many weeks. Adam Bishop reports.

Qantas has formally walked away from its second big deal in as many weeks, with the carrier confirming it has scrapped plans to extend a cooperative agreement with China Eastern Airlines.

The development follows intense security of the proposed extension of the pact placed on the Flying Kangaroo by the ACCC, and comes less than a week after the airline backed out of a full acquisition of Alliance Aviation over competition concerns.

Under the terms of the initial agreement, the two carriers coordinated efforts on pricing, schedules and marketing on the Shanghai route, but plans to extend the joint business were given a draft red light by the ACCC last month.

At the time, the competition regulator said the alliance would potentially “breach competition laws” if it were to go ahead, giving the two airlines the “opportunity and incentive to increase prices…by limiting or delaying the introduction of additional capacity on the Sydney-Shanghai route as passenger demand grows.”

Qantas stopped servicing the Sydney-Shanghai route during COVID-19 but is due to resume daily flights next weekend.

A spokesperson for the Aussie carrier told travelBulletin the airlines have commenced a process to unwind the joint business over the coming weeks.

“This includes an end to the coordination of pricing and schedules, and the removal of joint marketing material,” the carrier confirmed.

“To ensure there is no impact on customers, Qantas and China Eastern will honour all existing bookings, including the frequent flyer benefits and lounge access customers enjoyed under the joint business,” QF added.

“China Eastern remains an important partner for Qantas and our codeshare agreement will continue on routes between Australia and China which both airlines don’t operate

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