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Abu Dhabi, UAESunday 16 December 2018

Qantas’s London flight is a challenging one

In addition to affecting carriers in Europe and Australia, the route will bypass the Arabian Gulf airports, which are traditional stopover spots between the continents.
Qantas's new route direct between Australia and London bypasses the traditional stopover in the Middle East – cutting the region off from making money from the traffic between the continents. David Gray / Reuters
Qantas's new route direct between Australia and London bypasses the traditional stopover in the Middle East – cutting the region off from making money from the traffic between the continents. David Gray / Reuters

The planned introduction of direct flights by Qantas between London and Perth is set to shake up competition among carriers flying from Australia and Europe.

The development of aircraft capable of flying longer distances is also posing questions for the big Arabian Gulf airports that have become stopover hubs for global travel.

Qantas said this week it would launch daily non-stop flights from Perth to London’s Heathrow airport, making it the first regular passenger service to directly link Australia with Europe when it begins in March 2018.

Currently, passengers travelling between Europe and Australia can stop over in Dubai if flying with Emirates and Qantas as the pair operate a code-share agreement. Similarly, passengers of Etihad Airways and Virgin Australia, who also operate a code-share, can break their trip in Abu Dhabi.

Qantas said it would fly the 17-hour, 14,498-kilometre service using the 787-9 Dreamliner aircraft.

“With the arrival of the 777-8X in 2022, the prospect of Heathrow-Sydney will become a viable option,” said Saj Ahmad, the chief analyst at UK-based StrategicAero Research. “Given the extensive breadth of customers that transit through the GCC, of course there would be some material impact to demand. However, the sheer number of frequencies and flight choices provided out of the UK to Australia on Emirates, Etihad and Qatar would make it nigh on impossible for Qantas to offer the same because they only operate to Heathrow.”

Qantas expects the non-stop Perth to London option to attract passengers from as far away as Australia’s east coast.

“Our modelling also shows that people from the east coast as well as South Australia would fly domestically to Perth to connect to our non-stop London service,” said the Qantas Group chief executive, Alan Joyce. “Some will take the opportunity to break their journey, whether it’s for business meetings in Perth, to holiday or to visit family on their way to the UK and Europe.”

Under a deal signed in 2012, Qantas and Emirates have aligned loyalty programmes, booking systems and flight codes. Qantas does not offer flights from Perth to Dubai, using its code-share with Emirates to enable its passengers to travel between the two cities.

An Emirates spokesman told The National that the company “remains committed to offering 77 flights a week between Australia and Dubai with onward connections to 38 European destinations, including six in the United Kingdom alone”.

While Virgin Atlanic has no immediate plans to launch a direct flight between Perth and London, it will start next year a Perth to Abu Dhabi service, a spokesman told The National. Etihad declined to comment on the launch of the new Qantas route.

“On 9 June, 2017, Virgin Australia will introduce three services each week between Perth and Abu Dhabi using Airbus A330-200 aircraft, which will open up new European connections for Western Australia residents and will be the first time Virgin Australia’s A330 aircraft have been deployed on a long-haul international route,” a Virgin Australia spokesman said. “We continually review our operations but have no plans to introduce direct flights between Perth and London.”

British Airways, which operates daily flights to Sydney through Singapore, said its global route network “is under constant review”, but declined to comment further. Qatar Airways owns 20 per cent of British Airways owner IAG.

Qantas could eventually follow up its non-stop service between Perth and London with another between Sydney and the British capital.

“Qantas has sought to fly to the UK non-stop for years and it’s only really now it’s become viable thanks to the low cost and fuel efficient capabilities of the 787-9 that they’ve decided to launch the Perth-Heathrow route,” Mr Ahmad said. “Newer jets like the bigger and even more longer ranged 777-8X might also be something Qantas looks at for possible Sydney-Heathrow flights in the future.”

However, analysts say the route is a challenging one.

“While this is an interesting development, I don’t think I regard this as a revolutionary one,” said Peter Morris, the chief economist at London based-consultancy Ascend Worldwide. “There was an occasion many years ago when there was a non-stop London to Sydney flight on a ‘demo’ basis. The problem was that it had virtually no passengers due to the weight limitation, and this is the problem with long distance flying.”

Long-haul flights are not necessarily profitable, such as Singapore Airlines’ Singapore to New York service that was cancelled because it wasn’t commercial, Mr Morris said.

“The Perth market is smaller than those to Australia’s east such as Sydney and Melbourne, but the introduction of direct services is likely to stimulate growth,” said John Strickland, the director of the UK’s JLS Consulting. “Nevertheless it could be challenging to deliver profitability on such a long flight where most of the demand can be expected to be lower fare leisure traffic.”

lbarnard@thenational.ae

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