爆料王

For more than 15 years I鈥檝e had the privilege to research and teach airline strategy in the context of global aviation bilateral air service agreements.

These agreements are essentially trade deals between the 193 governments that are signatories to the聽.

The agreements allow designated airlines in the two signatory countries to operate air services connecting them in accordance with the reciprocity principle used in trade agreements, which is broadly: 鈥淚鈥檒l let you in if you let me in鈥�.

Australia has traditionally tried to deregulate international aviation, to make air travel easier for both Australians and visitors.

But in July, in an聽聽decision, Transport Minister Catherine King聽聽an application for Qatar to double its flights into Australia by providing what amounted to an extra flight a day into Brisbane, Melbourne and Sydney.

After being asked about the decision, the minister provided four different justifications, one of which was the 鈥溾��.

Assistant Treasurer Stephen Jones this week expanded on this reasoning, saying he didn鈥檛 want to drive ticket prices down to the point at which it was 鈥溾�� and that having Qantas occasionally make a profit was 鈥渁ctually a good news story鈥�.

On its face, this suggests the government is making decisions about landing rights in order to protect the profits of Qantas 鈥� a private company it hasn鈥檛 owned since 1995. This would be a seismic shift in Australia鈥檚 international aviation policy.

A case could be made that this is in breach of the Chicago convention. Regardless, it is damaging to Australia鈥檚 international reputation and Australia鈥檚 economy.

By my conservative estimate, the decision will cost Australia鈥檚 economy about $1 billion per year in lost income from tourism, VRF (visiting friends and relatives), and business travel and freight.

My calculations suggest capacity on the Kangaroo Route between Australia and Europe is only back to 70% of where it was before COVID, allowing current operators such as the Emirates-Qantas alliance to charge much more than they could before the pandemic.

Qantas announced last week it would聽聽to its international network, but not a single one was on flights to Europe.

The extra Qatar Airways flights would have also gone on to New Zealand, adding further capacity to that route and cutting prices for flights across the Tasman.

And it鈥檚 not only Qatar Airways. Turkish Airlines, through the Turkish government, has asked for permission to increase of the frequency of its Australian flights from four to 14 a week, providing daily services to Melbourne and Sydney.

罢耻谤办别测听聽received an answer.

The message Australia is sending is a dangerous one.

When COVID hit in 2020 and airlines including Qantas grounded their fleets, Qatar Airways temporarily became Australia鈥檚 鈥溾��, getting Australians home who might otherwise have been stranded. During the pandemic, some Qatar flights arrived in Australia with just 20 seats filled.

Qatar might have expected Australians to remember this and keep flying with them, and it has applied for enough flights to allow it to happen.

By denying Qatar this opportunity (and denying many Australians the opportunity to travel to Europe via Doha), Australia has shown it is prepared to be ungracious, and made it easier for other countries to treat it in the same fashion.

Australia鈥檚 number two domestic airline Virgin Australia, is planning a share market聽. By appearing to signal it is prepared to go out on a limb to support Qantas against competitors, Australia has perhaps unintentionally sent a powerful message to potential investors 鈥� that Virgin鈥檚 opponent gets protection it does not.

罢丑别谤别听might聽be a case for offering Qantas protection if it was at risk of needing a taxpayer-funded bailout to stay afloat. But Qantas has returned to profit 鈥� a record聽聽profit in the year to June, after doubling its revenue.

There might also be a case (and King has made this case) that Qantas needs to be protected because it has just purchased new, quieter 鈥溾�� planes on which it will need to see a return and will need to spend a further聽听迟辞听聽on fleet renewal to reach its net-zero target.

But for years () Qantas has been returning capital to its shareholders by share buy-backs instead of using it to buy planes. It thinks it can聽, and perhaps it is making so much profit that it can, but if it can鈥檛 do both, it can ease off on returning capital to shareholders.

Another argument () is that supporting Qantas will support 鈥渓ong-term, well-paid, secure jobs by Australians in the aviation sector.鈥�

But much of Qantas鈥檚 international skilled work is already done offshore including on its premier QF1 flight to London which is maintained by crews from the United Kingdom.

Unless there is some sort of hidden rationale, the decision to deny Qatar Airways extra flights seems inexplicable; and given Australia鈥檚 history, unAustralian.

It is important to recognise that these are trade agreements of considerable magnitude and that decisions taken by Australia invite retaliation.

As I keep telling my students, these seemingly-boring bilateral air service agreements can have big consequences if mishandled.

Years of worth of research and international best practice indicate that an open approach to air rights delivers the best economic outcomes, especially for the country doing the opening.

More trade results in a more prosperous Australia which is good for Australian travellers, Australian businesses, and ultimately Australian airlines, too.

Australia used to tell the rest of the world that trade was good. It would need to have a very good reason for behaving differently when it came to air travel.

This article was originally published on聽The Conversation听补蝉:听. It was written by聽Rico Merkert, Professor in Transport and Supply Chain Management and Deputy Director, Institute of Transport and Logistics Studies, 爆料王 Business School.