Qantas close to Emirates alliance
2012-07-27 10:53
Sydney -Australia's Qantas Airways is on the brink of an alliance with Emirates to revive its international arm that will see most of its London-bound flights routed through Dubai, a report said Thursday.
The move, which saw Qantas's share price rally eight percent to Aus$1.075, is part of the carrier's drive to turn around its fortunes after an 83 percent slump in first-half net profit in the six months to December.
The Australian Financial Review said code share negotiations were at an advanced stage and would give Qantas access to the network of the largest international carrier in the world.
Qantas is primarily losing money on its international routes.
The tie-up would see Qantas fly to Dubai for the first time and rely on its new partner to transfer passengers to destinations in Europe, the Middle East and Africa, it said.
The report said this would mean most London flights going through Dubai instead of Singapore, signalling an end to its long-standing joint venture with British Airways.
Qantas did not deny the report.
"At any one time we are talking to a number of airlines about a range of initiatives. However, we don't confirm or deny who we are in discussions with," a Qantas spokeswoman told AFP.
The newspaper said a link-up with Emirates would allow Qantas to maintain a global focus without having to fly its own planes, with high fuel costs sapping profits.
In return, it would give Emirates access to Qantas's market-leading share of Australian domestic traffic.
Qantas is struggling with soaring fuel costs and worsening global conditions and recently warned its underlying profit before tax was expected to drop from Aus$552 million (US$574 million) last year to Aus$50-100 million.
