A financial dispute between Perth Airport and Qantas has delayed plans to introduce direct France to Australia flights.
This comes at a time where Qantas has been very successful at running direct Perth to London services, with a load factor of 94%.
What are the details?
As reported by the Australian Financial Review, Qantas has decided to not order additional aircraft to fly out of Perth Airport. This is until they can resolve a landing fee issue, ongoing since last year.
This news comes directly from Qantas CEO, who spoke recently in broad statements to Perth Airport.
“…I don’t think shareholders would be too happy with us ordering a number of aircraft to invest at an airport where we don’t have certainty about the future”
Qantas has also been asked to move their international services away from the Qantas domestic terminal, T3, (where the current popular Perth to London route departs from) and join all the other international airlines (including rival Virgin Australia) at terminal one. Perth Airport has also blocked Perth to Auckland and Perth to Johannesburg until Qantas makes this change.
Qantas has a specific lounge at terminal three for international guests, and has made other investments since starting the service.
Why Paris to Perth flights?
As shown by the numbers, it looks as if passengers greatly prefer to fly as direct as possible rather than transfer through international hubs. Perth is in a unique position as it is just close enough to Europe to facilitate direct flights to Europe, South America, and Africa, within a reasonable time frame (16-17 hours).
Because Qantas is currently the only airline to offer this service (although it is rumored that Virgin Australia is looking into it) they have been able to leverage their monopoly and force competitors, Emirates and Etihad, to rapidly drop their prices.
If Qantas is allowed to start a direct Paris service, using new Dreamliners or their future Project Sunrise selection, they would again become the preferred service and be able to charge a premium.
Qantas is looking to become a worldwide airline, with flights from its hubs to all over the world. Photo: Wikimedia
What is the solution?
Despite this conflict over fees and terminal access, both Perth Airport and Qantas are confident that a solution can be reached.
Speaking at the same event reported by the Australian Financial Review, Alan Joyce commented that the airline is open to independent arbitration (which in this case, maybe the Western Australian Supreme Court).
“What we are asking for, in the last resort, is independent arbitration”
Wanting to understand both sides of the issue, Simple Flying contacted Perth Airport and received this reply from their spokesperson.
“France is a growing visitor market for Perth. There is no legal obstacle to Qantas starting a Perth-Paris service and under an existing agreement between Perth Airport and Qantas, those flights can operate from the temporary T3 International terminal.
“Perth Airport has repeatedly stated it is ready to host a Qantas Johannesburg service through T1 International where 17 other international carriers operate.
“Perth Airport has secured pricing agreements with 23 out of 24 airlines which operate at the airport – which is evidence that our approach to pricing is both fair and reasonable.
“Perth Airport is seeking a speedy resolution to the Qantas non-payment of airport charges issue and the current independent arbitration through the Supreme Court will best enable this.”
Qantas has been contacted for comment, but at the time of publication has not issued a statement. The story is still unfolding.
What do you think? Is Perth Airport standing in the way of Qantas’ future progress? Let us know in the comments below.