The chances of Qantas resuming its popular transpacific flights to North America were setback last week after the Australian airline blocked bookings until the end of October 2021. Qantas normally flies to New York, San Francisco, Los Angeles, Vancouver, and Honolulu. In addition, flights to Chicago were slated to start this year. But it seems Qantas doesn’t expect to head back to its North American destinations anytime soon.
Except for some repatriation and government-subsidized flights, Qantas grounded all its international flying earlier this year. While the airline’s CEO, Alan Joyce, has kept his options open regarding international flights to some destinations, he has been fairly unequivocal about North America.
Qantas had previously canceled its international flying through to March 2021 and started issuing refunds. Now, in a move that could indicate 2021 will be similar to 2020 when it comes to international travel, the United States is off Qantas’ books for a further 12 months.
Given Mr Joyce’s previous comments and no improvements in the broader operating environment, last week’s decision isn’t surprising.
“The United States, with the level of (COVID-19) prevalence there, is probably going to take some time. It’s probably going to need a vaccine before we can see that happening,” Mr Joyce previously said in a media briefing.
Qantas off transpacific flights, US airlines keep flying
However, Qantas’s decision does leave the transpacific market between the United States and Australia wide open to competing airlines, particularly the North American airlines who are back on the route.
In 2019, nearly four million travelers flew between Australia and the United States, or vice versa. Nearly four and a half million seats were available, and aircraft passenger load were hovering in the mid 80 percentages. In addition to Qantas; Virgin Australia, Delta Air Lines, American Airlines, and United Airlines all competed on routes between Australia and mainland United States. Qantas, Hawaiian Airlines, and Jetstar all flew between Australia and Hawaii. Both Air Canada and Qantas jetted between Australia and Vancouver.
While Qantas, Jetstar, Hawaiian Airlines, and Air Canada have all suspended their routes between Australia and North America, the big US carriers have continued to fly across the Pacific. United Airlines, in particular, has remained steadfast this year.
Qantas’ competitors snatch market share
After a relatively short absence, Delta Air Lines and American Airlines also resumed flights between Los Angeles and Sydney. There’s strong cargo demand on these flights. That helps offset the limited numbers of passengers that can be carried on these flights.
It also places these North American airlines in a strong strategic position when it comes to flying between North America and Australia, both now and down the track. By canceling all of its flights to North America for the foreseeable future, Qantas risks further long term reductions in its already diminishing pre-COVID-19 market share on the transpacific routes.
Qantas clearly knows what it’s doing, but it is also a high stakes gamble. The airline is handing market share on a platter to strong competitor airlines.
What do you think? Is Qantas right to block booking on North American flights for another 12 months? Will this boost Delta, American, and United on these routes in the long run? Post a comment and let us know.