New era as Qantas ends deal with BA

Qantas will replace Singapore with Dubai as its hub for European flights from March 2013 and coordinate pricing, sales and schedules with Emirates under the partnership unveiled yesterday.

Under the deal, the Australian airline will end its 17-year alliance with British Airways, owned by IAG, which some analysts said could seek a new partner, like Qatar Airways. “A key objective is to make Qantas International strong and viable, and bring it back to profitability,” Qantas chief executive Alan Joyce said.

Mr Joyce said the airline remained committed to reaching break-even in its international business in 2015 financial year.

He declined to comment on analysts’ estimates that the alliance would save Qantas A$90-100 million before taxes annually, or help it deliver cost savings.

IAG chief executive Willie Walsh said the two airlines would continue to work together as part of the oneworld alliance and through code-share agreements.

Australian routes have diminished in importance to BA in recent years, in part due to the dominance on these routes by Emirates and other Middle Eastern airlines.

“The world has changed since 1995 when the joint business started... this is a small part of our overall network and this move fits in with changes in our global strategy,” said Mr Walsh.