Qantas - Singapore Airlines merger mooted
15.06.05
Australia's trade minister is reported to have backed a merger between Qantas and Singapore Airlines (SIA). Mark Vaile is quoted by newspapers in Australia as saying Qantas faced serious commercial challenges and the government needed to ensure the airline was not exposed to unfair competition.
'My view is if [a merger] could occur then the government should not rule that out. Quite frankly, that is the direction that international aviation is moving in,' Vaile is reported to have said. Vaile's comments came as Australia considers scrapping foreign investment rules governing Qantas as part of a broad review of aviation policy. Qantas CEO Peter Gregg responded: 'We are very supportive of a regime in which consolidation can occur. It's happening in Europe, it's happening in Australia.'
A merger between Qantas and SIA would have serious implications for arch rivals British Airways and Virgin Atlantic. BA has a partnership services agreement with Qantas on the 'kangaroo route' between the UK and Australia while SIA is a 49% shareholder in Virgin Atlantic, which recently launched its first flights to Australia.
