Qantas-Emirates link forces Cathay Pacific to rethink network strategy
The Hong Kong flag carrier could lose its 'kangaroo route' passengers to alliance that is offering more destinations in Europe from Dubai
The proposed alliance between Australian carrier Qantas Airways and Dubai's Emirates could lure so-called "kangaroo route" passengers away from Cathay Pacific Airways.
The move will force Hong Kong's flag carrier to rethink its network strategy as an increasing number of carriers form bilateral agreements to increase their competitiveness.
The Australian Competition and Consumer Commission last month released a draft ruling proposing to allow the airlines to co-operate on passenger and freight operations across their networks. But it plans to limit the deal to five years because of concerns about the impact of the alliance on airline competition between Australia and New Zealand.
Although the final decision will not be made until April 1, it is highly likely that Emirates and Qantas could win approval and proceed to a comprehensive alignment on their schedules, air fares and products, so as to increase traffic between Australia and Europe through Dubai.
The so-called kangaroo route is an important revenue source for Cathay, which uses Hong Kong as a hub to transit passengers between the two continents.
The airline carried more than 120,000 passengers between Europe and Australasia last year, said Rupert Hogg, the director of sales and marketing at Cathay.