QANTAS, Malaysia Airlines and Air New Zealand have all lodged submissions to the ACCCenquiry into the proposed tie-up between Singapore Airlines and Virgin Australia – and all three say they do not oppose the pact.
Qantas said it does not object to authorisation of the alliance on the basis of unique characteristics of the international aviation industry which “give rise to profound challenges for participants”.
These include heavy regulation, government ownership or support of “virtually all international carriers,” high fixed costs, and “the importance (and tyranny) of geographic location”.
“Unsubsidised end-of-route operators (such as Qantas and Virgin Australia) are particularly disadvantaged,” Qantas said, adding that alliances and other cooperation between airlines from different countries are “the only effective way of overcoming the restrictive international regulatory environment”.
Air NZ’s submission also supports
the pact, saying that the SQ deal would be good for inbound tourism, and next to Virgin’s alliances with Delta, Etihad and Air NZ, will enable it to “effectively compete against Qantas’ dominant market position in the corporate/government market.”
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