Qantas Terminates Alliance Aviation Deal

Operator: Alliance Airlines (QQ/UTY) – Australia Aircraft: Embraer 190 – VH-XVM (Qantaslink Livery) MSN: 19000112 – First Flight: Jan 2007 Flight Number: QF1987 (operated for Qantas) Callsign: QFA1987 – Qantas One Niner Eight Seven Date: 12/07/2023 Route: Townsville Airport (TSV/YBTL) – Melbourne International Airport (MEL/YMML)

Qantas has announced the termination of acquisition plans outlined for Alliance Aviation.

A termination follows their initial agreement, which was revealed in May 2022. At the time, the mission was to acquire the Australia-based charter operator.

The Initial Announcement

On May 5th, 2022, Qantas initially announced it had agreed with Alliance Aviation to acquire the operator fully.

As part of the deal, Qantas would leverage the position of Alliance to serve the resources sector better. However, it still needed to be approved by shareholders at the time.

While Alliance only accounts for 2% of the total domestic market, with a fleet of 70 aircraft that can seat around 100 passengers, Qantas sees them as well suited to charter operations.

Why The Deal Has Been Terminated

Almost immediately, such a deal between Qantas and Alliance received strong opposition. Initially slated for completion promptly, the critical competition regulator flagged the acquisition in April 2023.

This is the same competition watchdog that has been keeping a close eye on the Qantas Group recently and attempted to ensure a fair landscape.

Every attempt by Qantas to expand their business with new partnerships or expand on existing ones has been rejected.

While the deal has been terminated, Qantas says it’ll keep a close relationship with Alliance. Qantas believes the relationship is hugely valuable to the overall business.

What’s The Future Plan For Qantas?

Qantas says the group will retain nearly 20% of Alliance as part of its long-term agreement that sees Alliance operate up to 30 of its E190s for Qantas Group.

Meanwhile, Qantas will want to continue growing its charter operations in a sector with 27% of the total charter market available.

Qantas further says it has agreed to exercise options of over four additional aircraft. This brings the total number of E190s operated to 26, with the four options remaining.

The new units will join the Qantas fleet from April 2024. These aircraft will thus play a fundamental role in the long-term growth of the Qantas Group.

Daniel Fowkes
19 Oct 2023
· Airlines 

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