COVID-19 crisis strengthens case for JAL-Qantas partnership

A proposal by Qantas and Japan Airlines (JAL) for extensive cooperation on services between Australasia and Japan would expand the number of codeshare routes they offer and allow faster resumption of international flights in this market, but regulators will weigh that against the increasingly dominant position it would give the pair.

The airlines have asked the governments involved to allow a metal-neutral joint venture on routes between Japan and Australia. This would be a very significant step, as it would potentially give the Qantas and JAL groups a nearly 70% share of passengers in what was a fast-growing international market. They also propose dramatically increasing their codesharing on domestic services and flights from Australia to New Zealand.

Qantas and JAL are looking to launch the arrangement in mid 2021, when they estimate international services will start to re-emerge.

The partnership proposal is a prime example of how airlines will look to strengthen cooperation as they rebuild their international networks following COVID-19. Japanese majors were already ramping up these efforts before the pandemic, as they have increasingly sought new partnerships to extend their reach in recent years.

Such moves have allowed these airlines to maximize their networks while keeping fleet growth in check. This has become more important because JAL now plans to shrink its international widebody fleet over the next few years. Qantas will also have fewer widebody aircraft to reinstate its long haul network, as it plans to keep its A380 fleet grounded for three years.