“As the world’s largest international airline, with a network that perfectly complements our own, Emirates will help us give our customers across Australia a dramatically expanded range of travel options… Together with Emirates, Qantas will provide a unique ‘one stop’ hub.” – Alan Joyce, QANTAS Group CEO, 06 September 2012.
Back in 2012 it was hard not share Mr Joyce’s enthusiasm for this new alliance which would save the international operation which was allegedly in a not so good position at the time. The partnership with Emirates would be perfect. The wonderful press releases almost seemed to allude that the “White Knight” had finally come and the international operation’s fortunes would indeed turn around. The key driving force behind this fantastic alliance and also its key selling point to consumers was that finally QANTAS customers would have access to “one-stop access to more than 70 Emirates destinations in Europe, the Middle East and Africa. (press release QANTAS 06 September 2012)” No more would QANTAS customers have to endure going via London Heathrow to connect to onward European services. It was now all about the “one-stop” services from Australia to Europe, albeit they would mostly be on Emirates aircraft – but QANTAS always listens to its customers and they wouldn’t mind one bit.
Some “hard decisions” had to be made given the challenging environment QANTAS operates and which seems to be immune to other airlines. These included telling British Airways “thanks, but we’re dumping you” and the long established “Joint Services Agreement” was terminated including virtually all QF/BA code-shares. The daily flight Sydney – Singapore – Frankfurt which connected perfectly as a “one-stop” with flights from Adelaide, Brisbane, Melbourne and Perth also had to go. Singapore Changi was “de-hubed” at a cost of millions.
Soon people out of Brisbane, Adelaide and Perth would be removed the option of flying a QANTAS operated flight to London or Frankfurt. It was now all about “one-stop” via Dubai on Emirates – as always, QANTAS listens to its customers and they would surely take up this option. It was all systems go and in early April 2013 the alliance was in full swing. Customers were offered the countless “QF8000” series code-share flights on Emirates operated aircraft to Europe – “one-stop” of course. Somewhere along the line you could even spot the 2 token QF operated flights that existed – the QF1/2/9/10 flights. From Australia to Europe these didn’t connect well with Emirates services. The bank of European flights from Australia are optimised to connect with Emirates’ late night departures as opposed to QF’s late afternoon services (this will change for the QF9/10 from late July 2014 which will have revised timings as late evening from Melbourne and daylight departure on the return from Heathrow).
But something recently has happened. The “one-stop” option seems to have gone along with the QF8000 series flights from Dubai to Europe. Travel agents linking in to QANTAS’ Amadeus reservation system are now being given the option of flying via London Heathrow and connecting on British Airways. Travel agents are having a strong case of déjà vu – it seems just like the JSA days. Looking at some examples of flight availability this is what agents are now presented with and also on many booking portals including.
A passenger wanting to fly from Sydney to Rome will be given the option of going on the QF1 to LHR and connect on BA.
How about Melbourne to Madrid? No problem – once again BA via LHR.
If you’re from Brisbane, now instead of “one-stop” it becomes “two-stop” via Melbourne or Sydney and Dubai.
Why is this happening? One possible answer is that patronage of these flights is not what was projected or planned and the carrier is keen to fill these services. The “one-stop” strategy which seemed like a good idea on paper has possibly been to the detriment of these services perhaps?
Now what about those QF8000 series flights to take advantage of the “one-stop” services? Those flights are actually still there, however savvy travel agents will need to know specific bypass system entries to have these flights offered. Taking Rome once again, using a bypass entry instructing the system to show these flights will show these results.
The problem is that travel agents may look for the path of least resistance and won’t be too keen to try and use more complex ways to get the information they need. One Senior Corporate Consultant who wants to remain anonymous stated “It’s all too hard with QANTAS. I just don’t bother booking them anymore. It’s very sad to see it come to this as they have such a fantastic group of people working there but my clients have had enough of the constant schedule changes and delays. It all went downhill after the grounding in 2011. I still can’t forget what my colleagues and my clients went through. Also I feel there is no support from their industry centre and their sales team are nowhere to be seen. I now mainly book Emirates, Etihad, BA, Cathay and Singapore Airlines – they have the network and frequency. It’s a product I can confidently offer my clients. Up until about 9 years ago, QANTAS was at the top of my list. Now it’s really not an option internationally.”
What is becoming more and more evident is that the problems with the international operations have very little to do with removing the hub via Asia and switch to Dubai; it’s more to do with ill thought and short sighted management strategies. An alliance with Emirates in theory is a sound move but only if they partners can have some form of equal sharing, but more importantly both airlines have to have strong solid management that knows what it takes to run an international airline. One airline has that. And the other airline has Alan Joyce and his team. Intrinsically that’s where the problems lie. Under Alan’s vision of building “a better, stronger, QANTAS” the international division continues to be scaled back through network cuts and fleet reductions. Apart from fourteen Boeing 787s destined for Jetstar, there is nothing concrete in “the books” for long haul aircraft orders to be used for QANTAS international expansion. Considering that the lead in time from placing an order to entry into service is around 9 years, it doesn’t take an airline economist to figure out that QANTAS management have pretty much given up on QANTAS internationally. In 9 years time internationally the airline may have paled into obscurity. Basically the airline is being suffocated to death.
In this context it is hard to justify or make sense of this alliance. To put it into perspective let’s imagine there are two fast food companies that are looking at co-operating. One is a large multi-national worldwide operation – let’s call it MegaBurgers Inc. The other is much smaller operation operating pre-dominantly on a local and national scale – let’s call it BurgerShack. MegaBurgers is relatively new to BurgerShack’s markets. The two companies start co-operating by offering each other’s products at their respective stores worldwide. It’s a great solution giving exposure worldwide to both companies. BurgerShack has a great product and a great work force but poor management. They start scaling back their operations giving more opportunity to MegaBurgers. Pretty soon BurgerShack is struggling and closes down. MegaBurgers comes out of this co-operation unscathed and possibly in a better position from when it started – it has access to a larger client base and now offers the products of BurgerShack. If we go back to the airlines, it’s really a no brainer to see which airline is the MegaBurger and which is BurgerShack.
Few would be able to argue that what Emirates has in terms of an hub, what the airline has is nothing short of world class. Dubai geographically is perfect however their seems to be a strong imbalance in this alliance. Unless QANTAS management takes an active approach on the international side by growing and expanding the business it’s pointless. QANTAS is nothing more that a virtual travel agent itself in this situation. Let’s really hope that “you’re the reason we fly” doesn’t end up being “you’re the reason we flew”.
