Virgin: QF in fit and healthy state

Virgin: QF in fit and healthy state
By admin

Virgin Australia has rejected the extent of Qantas’s self-described plight as it painted a picture of a fit and healthy airline with aspirations to grow its international network.

The carrier believes Qantas has overplayed its struggles to the competition watchdog and branded it a “strong and vigorous competitor”.

What Qantas is actively doing in terms of its route network contradicts the claim that it is struggling and unable to compete on the world stage, Virgin said.

The comments were contained in a submission to the Australian Competition and Consumer Commission (ACCC) as it continues to analyse the proposed alliance between Qantas and Emirates.

While not objecting to the tie-up, Virgin said there are issues the ACCC needs to address.

It told the regulator that announcements from Qantas that London flights via Dubai will operate irrespective of the alliance, and that it will add more capacity to Singapore, suggest an airline in growth rather than one in peril.

“These unilateral commercial decisions do not appear to be consistent with an airline that is seeking to withdraw from international markets due to substantial financial pressure,” Virgin said. “Rather, they appear to be the decisions of a strong and vigorous competitor seeking to retain its position in the relevant markets.”

Without the alliance, Qantas will “continue to expand internationally and compete more vigorously on international services”, the submission added.

In addition, Virgin argued that the addition of Qantas services through Dubai will increase competition with Emirates and lead to pricing and service benefits for passengers.

The carrier also argued that the scope of the alliance was “too broad” and open ended.

Virgin called on the ACCC to only approve the tie-up for five years, rather than the 10 wanted by Qantas and Emirates, if it ruled in favour of the application.

“Given the number of markets affected…..the competitive effects and public benefits should be tested over a shorter period,” the submission said.

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