Qantas Expresses Disappointment Over Delay With Review of Alliance Aviation Acquisition

A Qantas Boeing B737 taxiing
Robert Frola (GFDL or GFDL), via Wikimedia Commons

LONDON – Qantas has expressed disappointment in the Australian Competition and Consumer Commission’s (ACCC) decision to delay its findings on the airline’s acquisition of Alliance Aviation Services for a third time.

The Australian national flag carrier says it has been clear about its intention to fully acquire Alliance since it took a 19 per cent stake in the charter services operator in February 2019.

The ACCC took three years to investigate that minority holding and made no findings that it lessened competition. The Commission has also had the benefit of over two years of closely monitoring the domestic aviation industry, says Qantas.

Decision delayed until March 2023

The latest timeline pushes a decision by the ACCC on the full acquisition out to 20 March 2023, some 10 months since Qantas and Alliance filed their application for informal merger clearance. This would make it one of the longest processes for informal clearance in recent times.

This compares with the 11 days it took the ACCC to decide that it didn’t need to conduct a public review of Rex’s acquisition of National Jet Express from Cobham in July this year.

In their latest statement, Qantas says that it is a firm believer in regulation and due process, and has cooperated fully with information requests from the ACCC, but also believes such regulation needs to be timely and efficient to maintain confidence in the process.

The acquisition timeline so far

In August this year, Qantas reaffirmed its view that its acquisition of Alliance Aviation Services Ltd (Alliance) would not lessen competition in Australia’s highly competitive charter segment.

Qantas currently owns just under a 20 per cent interest in Alliance and is its biggest customer, wet leasing up to 18 Embraer aircraft that Alliance operates on the national carrier’s behalf on a number of routes.

In May 2022, Qantas had announced that it had reached an agreement to fully acquire Alliance, enabling it to better serve the growing resources sector with a combined fleet. That agreement included a condition for competition clearance.

Alliance represents around two per cent of the total Australian aviation industry and supplies about 30 per cent of the nation’s charter services, with the remainder split between Qantas (around 23 per cent), Virgin Australia (around 22 per cent) and a number of other operators.

Qantas had previously met with the Australian Competition and Consumer Commission (ACCC) watchdog, and provided a detailed submission on the competitive nature of the charter services.

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