British Airways in merger talks with Qantas (merged)

[captainspeaking]

BA Press Release received 13:00 local today

"In response to recent media speculation, British Airways Plc confirms that it is exploring a potential merger with Qantas Airways Limited via a dual-listed company structure.

The discussions between British Airways and Iberia are continuing.

There is no guarantee that any transaction will be forthcoming and a further announcement will be made in due course, if appropriate."

Presumably the model would be similar to Air France / KLM

[leemind]

Don't know if this is news to you boys & girls on the inside, but it just flicked up on Bloomberg

BA up 16% on the news...

[Goffee]

leemind - bugger - beat me to it!

Could put several cats among many pigeons.

[beamender99]

BBC TV also reporting it on lunchtime news

and
BBC NEWS | Business | BA is in merger talks with Qantas (http://news.bbc.co.uk/1/hi/business/7760851.stm)


and a statement from Waterworld
British Airways - Press Office (http://www.britishairways.com/travel/bapress/public/en_gb?gsLink=searchResults)

[Mick Stability]

Has Branson moaned yet?

[Raggyman]

Would be very supprised if they would be allowed by the Bristish and Australian government to go ahead with it.

Will never fly Qantas or BA again. What caused me to drop them completely was the lack of customer service and attention. To me, Qantas use to be alot different, and proud of the service they provide. Now, it is the same as BA. Don't get me wrong, pilots have been absolutely brillant, just a shame about the cabin staff.

I use to always fly qantas, until I had to catch BA flights from the North East UK for our honey moon back home to Oz. Got in early to make sure we had good seats, wasn't until we got on the plane that we found out we were across the aisle from each other. Would rather walk than catch a BA flight.

Talking to alot of other Australian's here in the UK, and most of them fly other airlines, who use to solely fly Qantas. Will be interesting if the merger does go ahead to see how much their market share is going to fall and I doubt gain.

[cameronaj]

What will be different? Surely they've been cosying up when it comes to the (high) pricing of their Australia/UK flights for yonks!

[renfrew]

The partnership has been going since 1934 and it would be a pity if Qantas was now taken over by someone else.
It will be interesting to see how Iberia and American fit in.

[Andy_S]

Would be very supprised if they would be allowed by the Bristish and Australian government to go ahead with it.

Since neither BA or Qantas is state owned or controlled, I can't see that either government has a veto.

[pax britanica]

Not sure about BA and Qantas other than the obvious cooperation on the old Kangaroo route. BA might not get as much out of that as Qantas though (think BA shorthaul (feeder/distribution) network serves a continent of 350million people QANTAS serves a continent of 24 million. In addition both have their hubs at the wrong extremity of the intercontinental sections.ie you get off at the last stop on the line and retrace your steps in both cases.
BA Iberia is differnt, Iberia service wise are pretty grim in my limited expereince but they serve a totally differnt market to BA in Latin America where BA have virtuallya token presence and BA serve India and Asia which are the dark side of the moon for Iberia
As for BA-AA that just seems an invitaion for the EU nd US regulators to make life very hard fr both companies for many years before any possible synergies can come through
PB

[Torquelink]

BA used to own a chunk of QF didn't they? Then sold it a year or two back. There's joined up thinking for you!

[beamender99]

In these hard times - B & Q the new DIY airline?

[Raggyman]

Since neither BA or Qantas is state owned or controlled, I can't see that either government has a veto.

Would have thought from Australia's perspective they would, as I think that it would fall under the Australian Competition and Consumer Commission and their Trade Practices Act for being anti competitive. I think it is still the case back home in Oz that any merger would have to be blessed by them, before they would be able to merge.

I think if the merger does go ahead, alot of australian's wouldn't fly them any more. There was pride in flying with Qantas because it was Australian.

[lomapaseo]

I think if the merger does go ahead, alot of australian's wouldn't fly them any more. There was pride in flying with Qantas because it was Australian.

If you don't work for a company, I don't think that there is such a thing as pride. It's simply service at a cost

But I gotta admit that when Pan Am and TWA transfered their routes and fleets I didn't fly them anymore either

[Raggyman]

If you don't work for a company, I don't think that there is such a thing as pride. It's simply service at a cost


Ah, maybe it was just me, and had pride when I flew with them. I use to be proud of the fact that they were Australian and you grew up with them and whenever you went somewhere you always flew them. Probably a better word would be loyalty rather than pride.

I guess that is why most people of my parents generation still fly them. It all comes down to exposure and what you are comfortable with. As for now, I fly Emirates where ever I can. For people who haven't travelled very much, flying a non native carrier can be a bit daunting. From simple things as they aren't aware that most people speak english, and in the case of emirates that not everyone who lives in the middle east is a terrorist and wants to kill every westerner in the place.

I think you would find that alot of people fly Qantas because it is identified as an Australian airline, and most Australian's would comfort that idea. Definitely in some cases people fly on price -vs- quality of service.

[Iver]

Just take SQ through Singapore if you want to fly the A380 exclusively to SYD....

[BEA 71]

People don´t make their decision based on PRIDE, they make it based on PRICE.

[Raggyman]

People don´t make their decision based on PRIDE, they make it based on PRICE.

If that is the case, then there would be loads of lost cost international carriers. There are always going to be people who buy a ticket based on price as well, just as there are people who fly particular airlines because of what they represent. That is why there are so many airlines around, each trying to provide each part of the market, and hopefully make some money out of it along the way.

If there was a £100 difference internationally between flying with the national carrier and a non national carrier, people I think would pay the difference.

Seasoned travellers would probably not apply this, or people on a tight budget.

[BEA 71]

Well, Raggyman, this was a lesson I have learned in more than three decades in the business. Of course there are always some very loyal
customers, but the majority will go on the cheapest possible fare.
Bargaing like on a bazaar is common at airline ticket desks. Ask ticket
agents from any airline. Temporarily there is a market for low cost
carriers, however they can not provide the services a established
airline can offer. Without Lufthansa, British Airways, Air France, Qantas,
Iberia etc. - just to name a few - there would be no global airline
network.

[bar none]

Why would the competition authorities want to look at a merger between two airlines when one of them flies to Australia only once per day ?
Raggyman used to fly Qantas because it was Australian. Airlines are in an international business and if Qantas was attractive to Australians rather than the wider world they would soon wither and die.
Also Raggyman if Qantas cabin crew standards began to match those of British Airways it would be an improvement. All the survays say so.

[merlinxx]

Is it not so perhaps, bring back the 'Cats':ok: The days of national loyalty has gone, long gone:ugh: OZ to UK & V.V. it's who's going to give the best prices, best service, best schedules, best stop-over deals etc, etc.:E QF have bad publicity right now, BA to a similar degree, both seemingly have "where are we heading" profiles.:ugh: The market is in flux, who the heck can predict what's going to happen in the next 3 months, let alone the next 6 to 24 ?:* If you're confused now, wait until early 2009.

[Raggyman]

BEA71 - Ah, totally agree. Probably more of the point I was making is that there were people who use to make a decision based purely on who the airline was, not just who had the cheapest fare. Price is a factor, most definitely. I guess it is also the type of people who are going to want to fly as well. You are always going to have people turning up at the airport, and wanting to fly immediately with the cheapest, and then there are those that save for that once in a lifetime flight and go with what the masses are comfortable with or what comes recommended from their travel agent.

bar none - Any large mergers would attract initially the attention from the competition authorities. Whether they would be happy about it, who knows. They do work in mysterious ways sometimes. They have only recently allowed other international airlines in to run domestic flights as far as I am aware. Yeah, as I was saying, Qantas use to have good standards (going back a few years now), and had never flown BA until I had moved over to the UK. On the flights I had flown, around 6 or so, there has always been an issue. Flight to Munich, bags didn't turn up. Got them three days later when we got onto our return flight, completely soaked and full of water. Honey moon flight, got seperated by the isle. Flight to London, after landing waited for 1 hour or so while apparently someone had to be found to operate the aero bridge. Flight to Oz, bags went to singapore and then flown back to london, and didn't get to Oz. Maybe, strokes of bad luck, but was enough to find alternatives.

merlinxx - Definitely very interesting times ahead that is for sure..

[BEA 71]

Raggyman - No airline in the world does intentionally lose baggage. At most airports the baggage handling is done by the airport company,
who, although they cause the problem, do not take the blame. Airlines
have to pay compensation to the customer and settle all claims. The
legal side is clear - the passenger has a contract with the airline, not
with the airport company. Lost baggage is a neuralgic and very costly point, some airports are worse than others, the airlines get a bad
reputation for something they haven´t caused. The whole situation
gives a lot of room for speculation, but let´s stay with facts only -
a baggage handler leaves a whole trolley of bags behind and the airline
pays the bill...

[Max Tow]

I'd guess this would finally enable BA to stop the expensive business of flying London based crews to any further than BKK & SIN on the Oz route and possibly ditto QF in the other direction....back to the old Imperial + Qantas routing!

[L337]

Much more fun is the "name" of the newly merged Airlines.

BATAS

QABAS

British OZ Airways

British Australian

BANAS

BANTAS

[VAFFPAX]

L337, you missed out B&Q (as someone else pointed out). :-)

As for the news, Oz laws state that no foreign entity can own more than 49% of an Oz airline, and those 49% can be owned by a single entity. However, the Oz government has in the past indicated that they would waive this requirement for the right bidder.

The Air Partners bid failed (which would have had this requirement waived) because Qantas shareholders didn't like the deal. If BA decided to offer the right deal, who knows - They might get that requirement waived too.

IMO this stinks of keeping up with the Joneses ("Lufthansa's doing it, we must too"). I'd rather have BA pay up the hole in their pension fund and improve their punctuality before starting to look at who they can buy next.

S.

[Wycombe]

Much more fun is the "name" of the newly merged Airlines

What about, dare I suggest......

Speedbird

Would be a great name for an airline, rather than just a callsign, no worries about offending national sensitivities.

[L337]

... and improve there punctuality.

To quote the Intranet from a few days ago:

T5 punctuality is a record breaker

Another punctuality record was broken at T5 yesterday when 75 per cent of shorthaul departures departed on time or early.

The record-breaking performance capped a successful day across the network, with more than half of British Airways’ flights across the network – 377 out of 697 – departing early.

A total of 124 flights departed early from Heathrow, the fourth highest on record and the second highest ever during the winter season. Meanwhile in T1, BA is regularly seeing the entire operation departing within the industry standard of 15 minutes

There was a fantastic performance at Gatwick too, with 44 out of 82 flights departing early or on time.

“Yesterday was a fantastic performance and I would like to thank our teams across the network for all your hard work,” said GM operations and punctuality Peter Lynam.

“Delivering a strong operational performance during these tough times is vital. We are consistently setting new standards of performance that our competitors simply cannot match.”

[Ametyst1]

If you a re looking for a new name for a merged BA/Qantas/Iberia/American set-up how about OneWorld!

[EdnaClouds]

Or Britas ;)

[semp66]

The "Flying Briq" :\

[Ancient Observer]

Well done, whoever spotted the potential of B & Q as the name of the new airline.
One of the issues that they will have to deal with is the routing problem. Why on earth would anyone from Europe wanting to get to ANZ use B & Q when they could go via Etihad/Emirates, via much much nicer terminals, at a cheaper price?

[PAXboy]

From BA... with more than half of British Airways’ flights across the network – 377 out of 697 – departing early.Well - if you schedule your departure time sufficiently far ahead of actual times agreed with ATC, then you ought to get 90% away early. :rolleyes:

Merger or partnership? If a merger, then they would probably create a holding company, something like Trans World Airlines for example. :p then each airline remains a 'local' company.

I agree with Ametyst1, and have said several times in various threads that we will move towards having a handful of super carriers that own a number of airlines and they will be called, OneWorld, SkyTeam, Star Alliance and so on. The deeper this global recession becomes, the sooner these super carriers will emerge.

The folks that set up the alliances and all the carriers have been waiting for this moment. Only a serious recession will force govts to give up control in order to allow something of the original airline to remain and some jobs to be retained. Otherwise countries will lose their own airline identity. And, for reasons I understand, most countries still consider it an important vanity to have their 'own' airline.

[AUTOGLIDE]

BEA 71, BA employ their own baggage handlers at LHR, and that is the location Raggyman was referring to.

[BEA 71]

I was fully aware of that. My statement was a general one.

[Dan Air 87]

Where will BA's appetite for mergers cease? First its AA (a brilliant deal), then IB and now QF. Its fantastic that BA are looking at doing something positive in the business and face up to the KLM-AF and the DL combines. It make sense. Then we have the predictable whine from the other lot about it (same boring song, same boring singer). I for one hope that BA gets its way with the mergers which will create a world class super carrier.

In the wake of all of this is Ryanair don't manager to get Aer Lingus, there is one other British airline that they could take over and make something out of it. Ahhh the prospect there is something!

[Railgun]

Interesting times ahead for all of us at BA i feel. I do think Mr Walsh and his other managers should take a grasp of the situation within the BA group itself and sort out some issues with itself far closer to home.

[PAXboy]

Dan Air 87Ryanair don't manager to get Aer Lingus Whilst trying not to drift the thread too far, I have no doubt that RYR will get it's prey. Not just yet awhile - but they will get them.

[MarkD]

Bigger is better boys and girls - look how it worked for Citibank... or, er, not... :E

[Seat62K]

This is being presented as a 50:50 merger of equals (based, presumably, on stock market valuations) and not as a takeover by BA, even though BA must surely be the bigger airline (in passenger-km terms, for example).

I see from the UK broadsheet press that Iberia is unhappy at being kept in the dark. There are suggestions that BA might be using the Qantas negotiations to put pressure on Iberia to reach a deal (although, as I've written elsewhere on PPRuNe, I think it would be a grave error for BA to merge with Iberia, given, apart from anything else, the lack of customer service values in the latter's corporate culture).