Qantas Abandons Alliance Airlines Acquisition Plans, Expands E190 Fleet

Qantas has officially halted its pursuit to acquire the remaining 100% stake in Alliance Airlines, stating on October 19 that there was no feasible path forward for the deal at present. The Australian carrier, which already owns 19.7% of the Brisbane International-based closed charter specialist, had proposed the acquisition last year but faced opposition from the Australian Competition and Consumer Commission (ACCC) in April.

Despite acknowledging the ACCC’s decision, both Qantas and Alliance Airlines believed the deal would have added customer value without compromising competition. Qantas highlighted the potential efficiencies from combining the two airlines’ Fokker 100s. While Qantas will maintain its existing shareholding in Alliance Airlines, it has opted to exercise options to wet lease an additional four Alliance-operated Embraer E190-100ARs. These aircraft are scheduled to join the Qantas fleet from April 2024, bringing the total number of Embraers leased by the airline to 26, with four more options yet to be exercised.

John Gissing, Qantas Group Executive of Associated Airlines and Services, emphasized Alliance’s importance as a partner, stating, “These four new aircraft will provide additional capacity and connectivity in the domestic market.”

Meanwhile, the ACCC is set to resume monitoring Australia’s domestic passenger airlines to address inappropriate market conduct. This move comes at the Australian government’s request, following previous quarterly reports detailing industry performance. Despite opposition from Qantas, the ACCC reports are reinstated, aiming to enhance oversight, transparency, and consumer protection in the aviation sector. The direction will apply for three years, commencing before the end of the year, with quarterly reports scheduled for release.

Qantas’ decision not to pursue full ownership of Alliance Airlines reflects a strategic shift, and the expansion of its E190 fleet signals a continued commitment to enhancing domestic connectivity. As the aviation landscape evolves, the ACCC’s renewed focus on monitoring market conduct aims to ensure fair competition, improved services, and increased transparency in Australia’s aviation sector.