klakzky123
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Re: AA and QF re-file for Joint Venture

Mon Mar 05, 2018 7:11 pm

Isn't Australia excluded from the UA-NZ JV? I think DL-VA is the only actual JV that covers flights from Australia to the US. If you exclude the UA flights from the US to Australia, their JV looks a lot smaller.
 
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RyanairGuru
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Re: AA and QF re-file for Joint Venture

Mon Mar 05, 2018 7:59 pm

Kashmon wrote:
This should be blocked to much gain for the corporation not much added choice for the consumer
The government should request that QF/AA to
- Brisbane to SFO/LAX/DFW , and Mel to DFW,LAX,SFO,ORD and bring forward and launch direct MEL/SYD - JFK by 2019 not 2022 and PER-LAX
-start year round service to AKL from LAX and DFW, Seasonal service to CHC from LAX
All launched by end 2019
only then will consumers have more choice and force QF/AA to better connect AUS/NZ to USA

otherwise AA can happily cancel all its code shares ( are they stupid?!!)


I assume this was a joke, but I actually can’t tell. The giveaway that you were trolling is saying they need to launch SYD-JFK by 2019 when there is no aircraft of physically capable of doing it, and launch CHC-LAX when both airlines are a bit player in the New Zealand market. The good news is that no JV approval ever has required airlines to start new routes they currently don’t serve, the most that’s ever happened is ruling that the carriers must preserve current capacity and/or give up slots to a new competitor.
Worked Hard, Flew Right
 
AAplat4life
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 1:05 pm

Many of the market changes since the last application have been self-imposed by AA, which historically has had competition issues with the government. Despite the change in administrations, the antitrust division at the Justice Department has a pretty good institutional memory. So I’m not convinced the U.S. government will grant the JV antitrust immunity. It does seem a bit unfair to AA given the scope of other alliances, but that’s not the focus of the approval process.
 
getluv
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 1:22 pm

AAplat4life wrote:
Many of the market changes since the last application have been self-imposed by AA, which historically has had competition issues with the government. Despite the change in administrations, the antitrust division at the Justice Department has a pretty good institutional memory. So I’m not convinced the U.S. government will grant the JV antitrust immunity. It does seem a bit unfair to AA given the scope of other alliances, but that’s not the focus of the approval process.


While the changes are self-imposed, AA's marketshare is relatively small between AUS-USA, so it wouldn't make a difference if they approved it.

I think the original decision was overly harsh on QF, attributing the fact that QF charges 30-50% more on J class seats as a demonstration of QF's dominance.

The ACCC, which is usually tough on JVs and mergers, didn't think there would be much in a way of consumer benefits or detriments, however agreed that without QF, AA doesn't have a chance.
You meant lose, not loose.
 
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vhtje
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 5:05 pm

Do we have any indication on when the DOT will rule on this application? I looked in the linked Dallas News story, but it did not say.
I only turn left when boarding aircraft. Well, mostly. All right, sometimes. OH OKAY - rarely.
 
winginit
Topic Author
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 6:56 pm

rbavfan wrote:
Sorry but their savings for customers is a joke. What they are really after in the long run is a JV with Anti Trust Immunity.


obviously... because that's the purpose of this filing...

rbavfan wrote:
We have seen on the north atlantic that JV do nothing but keep the prices high and allow them to price fix against any new competition.


have we seen that? If you could provide some objective evidence that would be great. If you actually read the filing it shows the contrary, although I'll be quick to point out that those pricing reductions are the result of the combination of cheap fuel and long haul LCCs like Norwegian and the Icelandic carriers. It's convenient timing for a case like this one, but the argument that JVs have kept fares high doesn't hold weight when faced with evidence.
 
DavidByrne
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 9:22 pm

aa1818 wrote:
UA/NZ enjoy monopolies on [ . . . ] HNL-AKL

I think you're forgetting HA's service on HNL-AKL.
This is not my beautiful house . . . This is not my beautiful wife
 
Kashmon
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Re: AA and QF re-file for Joint Venture

Tue Mar 06, 2018 11:50 pm

RyanairGuru wrote:
Kashmon wrote:
This should be blocked to much gain for the corporation not much added choice for the consumer
The government should request that QF/AA to
- Brisbane to SFO/LAX/DFW , and Mel to DFW,LAX,SFO,ORD and bring forward and launch direct MEL/SYD - JFK by 2019 not 2022 and PER-LAX
-start year round service to AKL from LAX and DFW, Seasonal service to CHC from LAX
All launched by end 2019
only then will consumers have more choice and force QF/AA to better connect AUS/NZ to USA

otherwise AA can happily cancel all its code shares ( are they stupid?!!)


I assume this was a joke, but I actually can’t tell. The giveaway that you were trolling is saying they need to launch SYD-JFK by 2019 when there is no aircraft of physically capable of doing it, and launch CHC-LAX when both airlines are a bit player in the New Zealand market. The good news is that no JV approval ever has required airlines to start new routes they currently don’t serve, the most that’s ever happened is ruling that the carriers must preserve current capacity and/or give up slots to a new competitor.

exactly
which means they do not care about the customer

QF has publically stated that it wants to launch SYD-JFK by 2022

I had assumed the A350lr was capable- must be the 777-8 so that will have to be removed

if they are not going to force QF to launch new routes- why is there even a hurdle? just let it pass! The DOJ seems to be more a tool used by competitors who only care about themselves instead of protecting and increasing the gains to the citizens
 
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LAXintl
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Re: AA and QF re-file for Joint Venture

Wed Jun 13, 2018 10:54 pm

DOT is back to the applicants today with long request for additional information as it cannot establish a procedural schedule to review the application at this time.

DOT says, applicants have not supplied sufficient "information required to evaluate the Joint Applicants’ claims that their immunized joint business will deliver the public benefits claimed in this application."

In general material DOT seeks centers around:
o Details about specific levels of service that the proposed joint business would provide in years to come
o The extent to which antitrust immunity is necessary to achieve these benefits
o Discussion of planned codeshares
o Clarification on revenue share methodology and potential enhancements in yield management practices under any potential immunized joint venture
o Financial performance data for existing flights, and projected future performance under a JV.
o A deeper explanation of expected consumer benefits versus existing partnership between applicants.

=

OST-2018-0030
From the desert to the sea, to all of Southern California
 
smi0006
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Re: AA and QF re-file for Joint Venture

Wed Jun 13, 2018 11:34 pm

LAXintl wrote:
DOT is back to the applicants today with long request for additional information as it cannot establish a procedural schedule to review the application at this time.

DOT says, applicants have not supplied sufficient "information required to evaluate the Joint Applicants’ claims that their immunized joint business will deliver the public benefits claimed in this application."

In general material DOT seeks centers around:
o Details about specific levels of service that the proposed joint business would provide in years to come
o The extent to which antitrust immunity is necessary to achieve these benefits
o Discussion of planned codeshares
o Clarification on revenue share methodology and potential enhancements in yield management practices under any potential immunized joint venture
o Financial performance data for existing flights, and projected future performance under a JV.
o A deeper explanation of expected consumer benefits versus existing partnership between applicants.

=

OST-2018-0030


Good to see some form of update, had gone quiet.

Are these normal expectations for a JV? Did the transatlantic JVs require so much detail also?
S
 
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LAXintl
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Re: AA and QF re-file for Joint Venture

Thu Jun 14, 2018 12:24 am

Additional information request is pretty common, though this one is pretty expansive.
From the desert to the sea, to all of Southern California
 
ADrum23
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Re: AA and QF re-file for Joint Venture

Thu Jun 14, 2018 1:28 am

LAXintl wrote:
Additional information request is pretty common, though this one is pretty expansive.


I know, and I don't get why. It's not like there is a huge market to Oceania from North America, so if UA and NZ can have a JV, why can't AA and QF?
 
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LAXintl
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Re: AA and QF re-file for Joint Venture

Thu Jun 14, 2018 4:59 pm

The worry is market concentration.

In 2017 AA-QF had 49.7% seat market share. This was only down slightly from 50.2% in 2016 when JV was denied.

DOT concerns in 2016 are largely still valid. Their worry about reduced consumer choice (today AA-QF still very much compete with each other on price for example), along with worries about what applicants would do about their dominant market capacity vis-a-vis competitors puts in doubt the public benefit arguments.
From the desert to the sea, to all of Southern California
 
getluv
Posts: 256
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Re: AA and QF re-file for Joint Venture

Sat Jun 16, 2018 9:03 am

LAXintl wrote:
The worry is market concentration.

In 2017 AA-QF had 49.7% seat market share. This was only down slightly from 50.2% in 2016 when JV was denied.

DOT concerns in 2016 are largely still valid. Their worry about reduced consumer choice (today AA-QF still very much compete with each other on price for example), along with worries about what applicants would do about their dominant market capacity vis-a-vis competitors puts in doubt the public benefit arguments.


I disagree because the DOT approved UA/NZ JV with nearly 100% marketshare between US and NZ. Also, I can't see without the help of QF, how AA could really expand in NZ or Australia. What's worse for AA, is that QF and AS are also friendly. In saying that, I don't blame the DOT for the information they requested. The issue is with those applications is how much you want your competitors to know about what you're going to do, which is why the application was light on certain details.
You meant lose, not loose.
 
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LAXintl
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Re: AA and QF re-file for Joint Venture

Sat Jun 16, 2018 3:45 pm

Comparison between AA-QF to NZ-UA are not apt. The market realities and regulator concerns were quite different.

In simplistic terms the NZ-UA deal was more about a small nation carrier trying finding a global partner. Approval was not going to alter the landscape since UA was not a direct competitor against NZ, and only launched its own AKL service as part of the JV roll out in 2016

AA-QF JV on the other hand would bind the market share of two direct competitors giving them ~50 percent share which opens door for concerns about exclusionary or predatory acts may raise antitrust concerns. Exclusionary or predatory acts may include such things as exclusive supply or purchase agreements; tying; predatory pricing; or refusal to deal, which could end up hurting competition and consumers.

Frankly, the whole AA-QF JV case would be much easier if AA never served SYD, and possibly if QF would not have publicly made known its DFW service is virtually solely meant to feed traffic into the AA network and would greatly benefit from JV (and matter of fact threatened to drop route otherwise).

At the end, I see the JV being approved - however with conditions such as conditions of QF having to interline, offer prorate fares, capacity, etc for competitors, and possibly JV parties agreeing to offer certain levels capacity along with a follow up JV review few years down the road to see how competitive landscape has evolved.
From the desert to the sea, to all of Southern California
 
MIflyer12
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Re: AA and QF re-file for Joint Venture

Sat Jun 16, 2018 5:47 pm

getluv wrote:
Also, I can't see without the help of QF, how AA could really expand in NZ or Australia.


Really? AA is the largest carrier in the world. On LAX (where it's the largest carrier) to AKL or SYD it's got over 100 capable aircraft (777/77W/788/789). A JV here will just limit competition.

Let's hope LAXintl gets a job at the DOJ reviewing airline anti-trust applications.
 
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NeBaNi
Posts: 303
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Re: AA and QF re-file for Joint Venture

Sat Jun 16, 2018 10:21 pm

LAXintl wrote:
Comparison between AA-QF to NZ-UA are not apt. The market realities and regulator concerns were quite different.

In simplistic terms the NZ-UA deal was more about a small nation carrier trying finding a global partner. Approval was not going to alter the landscape since UA was not a direct competitor against NZ, and only launched its own AKL service as part of the JV roll out in 2016

AA-QF JV on the other hand would bind the market share of two direct competitors giving them ~50 percent share which opens door for concerns about exclusionary or predatory acts may raise antitrust concerns. Exclusionary or predatory acts may include such things as exclusive supply or purchase agreements; tying; predatory pricing; or refusal to deal, which could end up hurting competition and consumers.

Frankly, the whole AA-QF JV case would be much easier if AA never served SYD, and possibly if QF would not have publicly made known its DFW service is virtually solely meant to feed traffic into the AA network and would greatly benefit from JV (and matter of fact threatened to drop route otherwise).

At the end, I see the JV being approved - however with conditions such as conditions of QF having to interline, offer prorate fares, capacity, etc for competitors, and possibly JV parties agreeing to offer certain levels capacity along with a follow up JV review few years down the road to see how competitive landscape has evolved.

I also see a potential double whammy in that a weaker carrier like Virgin Australia, or even Delta, drops the route if the JV is approved. So the passenger goes from having 5 options to effectively 3.
 
getluv
Posts: 256
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Re: AA and QF re-file for Joint Venture

Sun Jun 17, 2018 8:35 am

LAXintl wrote:
Comparison between AA-QF to NZ-UA are not apt. The market realities and regulator concerns were quite different.

In simplistic terms the NZ-UA deal was more about a small nation carrier trying finding a global partner. Approval was not going to alter the landscape since UA was not a direct competitor against NZ, and only launched its own AKL service as part of the JV roll out in 2016

AA-QF JV on the other hand would bind the market share of two direct competitors giving them ~50 percent share which opens door for concerns about exclusionary or predatory acts may raise antitrust concerns. Exclusionary or predatory acts may include such things as exclusive supply or purchase agreements; tying; predatory pricing; or refusal to deal, which could end up hurting competition and consumers.

Frankly, the whole AA-QF JV case would be much easier if AA never served SYD, and possibly if QF would not have publicly made known its DFW service is virtually solely meant to feed traffic into the AA network and would greatly benefit from JV (and matter of fact threatened to drop route otherwise).

At the end, I see the JV being approved - however with conditions such as conditions of QF having to interline, offer prorate fares, capacity, etc for competitors, and possibly JV parties agreeing to offer certain levels capacity along with a follow up JV review few years down the road to see how competitive landscape has evolved.


I think the comparison is entirely apt. Look at the fares between LAX-AKL. While direct will always attract a premium the fact that there is lack of competition against NZ/UA says it all. While NZ is a much smaller market compared to Australia, Australia is also much smaller market compared to Europe and Asia, when you combine that’s with the tyranny of distance QF/AA were hard done by, especially when you consider UA/NZ. I fail to see how QF charging more than the competition has more to do with brand than anything else. I don’t think market share always equals market dominance. A near monopoly status is a different story, witness UA/NZ.

QF was serving DFW prior under the previous JBA, so it was important to highlight what advantages there have been so far.

NeBaNi wrote:
I also see a potential double whammy in that a weaker carrier like Virgin Australia, or even Delta, drops the route if the JV is approved. So the passenger goes from having 5 options to effectively 3.


Delta and VA have a JV, so it would be 4 options to 3. And let’s be fair, all the options would be on one route, SYD-LAX.

MIflyer12 wrote:
getluv wrote:
Also, I can't see without the help of QF, how AA could really expand in NZ or Australia.


Really? AA is the largest carrier in the world. On LAX (where it's the largest carrier) to AKL or SYD it's got over 100 capable aircraft (777/77W/788/789). A JV here will just limit competition..


Means nothing. AA didn’t serve Australia or NZ for a number of decades.
You meant lose, not loose.

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