ATW Daily News

Qantas denies BA talks, remains optimistic about independent future

Wednesday November 25, 2009

Qantas dismissed rumors out of London that it is interested in restarting merger talks with British Airways, stating yesterday that "consolidation is not on the carrier's agenda."

The denial from QF CFO Colin Storrie came at an investor conference in Sydney, where the airline recommitted to its 2010 and 2011 capital expenditure program for 42 aircraft worth A$4.4 billion ($4.05 million). Late last year Qantas and BA discussed a merger at length, but the talks were abandoned in December (ATWOnline, Dec. 19, 2008).

Over the next two years the airline group will take delivery of eight 450-seat A380s, three A330s, nine 737-800s and six Q400 regional aircraft, while its Jetstar Airways subsidiary will get 17 more 180-seat A320s. In the longer term, QF has firm commitments for a further 92 aircraft, including 50 787s. The Dreamliner is due to make its first flight on Dec. 22.

Last spring, Qantas cut capacity and staff, grounded aircraft and cancelled orders for 15 787s (ATWOnline, June 29), measures that CEO Alan Joyce said no longer are necessary. It also launched a A$1.5 billion cost-cutting program over the next three years, along with its "Airport of the Future" designed to handle more passengers without major terminal expansion (ATWOnline, Nov. 12).

Next month it will reveal a reconfiguration of its A380s and 747s to eliminate first class on more routes, decrease the number of business class seats and increase capacity in premium economy and economy cabins. QF's A380s and some of its 747s have the lowest seat count--450 and 305 respectively--in the industry because of the heavy focus by previous management on premium travel.

Despite the reductions, Joyce told ATWOnline this month that he is confident "premium travel will return" and is "upbeat on the recovery" witnessed on domestic routes.

by Geoffrey Thomas

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