Should a code-share deal with Emirates come to pass, Qantas would probably end its Frankfurt flights at least. Qantas CEO Alan Joyce has indicated that linking with other airlines is part of the solution for the carrier's ailing long-haul operation. But picking the right partner will be key, and the existing British Airways partnership would likely be a casualty of an Emirates link.
In contrast to Qantas and British Airways, Emirates has been continuing to ramp up its flights from Australia to its Dubai hub, allowing links to London and the rest of its European network. Brown says Australia and New Zealand now represent Emirates' second-largest market by revenue, behind only the United Arab Emirates.
Despite Qantas pulling back its European services, competition is tough on these routes, Brown says. Singapore Airlines is “firmly entrenched” in Australia, and while it is too early to determine the impact of the Chinese airlines, “they will be a force” at some point.
Emirates will have a total of 84 flights a week between five Australian cities and Dubai by March, after it adds daily service to Adelaide and boosts Perth frequency to three flights a day. It has three daily flights to Melbourne and Sydney, one each with an A380. The airline is on record as targeting 100 flights a week into Australia, Brown says.
The current governmental air services agreement only allows Emirates 84 flights a week. However, the daily flight to Adelaide will not be counted under the cap, so Emirates can still add seven more frequencies to the larger cities. Brown says the airline will wait until it is using all rights available under the current agreement before pushing for rights to be expanded.
Singapore Airlines (SIA) is the largest of the foreign carriers in the Australian market. It operates 101 weekly flights into five Australian cities, including four daily to Sydney and three daily to Melbourne, Brisbane and Perth. Two each of the Sydney and Melbourne flights use A380s. A fourth daily to Perth will be added in October.
The airline serves 14 cities in Europe direct from Singapore, and starting in October it will boost its London service to four flights per day.
Competition on the Australia-London route is hardly a new phenomenon, although it has intensified with the entry and growth of carriers from the Middle East and other Asian countries, a SIA spokesman says. While the airline will not divulge details, the spokesman says the Kangaroo route “remains one of the major contributors to [SIA's] overall revenue.” Australia-London revenue increased in the first quarter of its 2012-13 fiscal year, compared to the same period a year earlier.
Etihad is another carrier that is increasing its foothold in Australia. It does not have the volume of flights that Emirates has, although it has the advantage of a strategic partnership with Virgin Australia that helps increase domestic feed for its services to its Abu Dhabi hub.
The airline operates 18 weekly flights from Melbourne and Sydney to Abu Dhabi and three one-stop flights a week to Brisbane via Singapore. The Brisbane service will increase to daily in February. Etihad also code-shares on three weekly Virgin Australia flights to Abu Dhabi.