Rejected!

Good Morning, Cafe Patrons.

I am serving up a special, extra strong shot of travel caffeine today, as I think we all need something potent to help clear our minds of what has been a truly befuddling week in the Australian air travel industry.

Virgin Blue was left hanging at both the US and Australian altars with two of their brides-to-be - Delta and Air New Zealand - as the US Department of Transportation rejected their proposed tie-up with Delta, and the Australian Competition and Consumer Commission did the same with their Air New Zealand proposal. In both rejections, the hypocrisy seems quite evident as not only has the US DOT has approved a similar (but much larger) British Airways / American Airlines trans-Atlantic partnership but the ACCC in Australia actually approved the Virgin / Delta deal last year.

Ironically, on the very same day the US DOT rejected the Virgin / Delta marriage another Australian Government entity, the International Air Services Commission, approved a continuation of what now amounts to a duopoly on the Australia-South Africa route by extending the codeshare agreement between Qantas and South African Airways. This duopoly is thanks to V Australia (owned by Virgin Blue) recently pulling out of the AUS-SA route, leaving those two aforementioned code share partners the only direct services between the two countries.

Both regulatory bodies cited various anti-consumer sentiments in denying the partnerships, but in my mind (both as a corporate and consumer purchaser of travel) I certainly don't think either body was representing my interests. Why isn't the ACCC weighing in on the South African/Qantas code share for instance, instead leaving it to some other governmental body to ascertain the impact on the consumer? Isn't the 2nd "C" in ACCC all about the consumer?

Perhaps Virgin and Delta should hire the lobbyists that BA and AA used when petitioning the US DOT on their alliance across the Atlantic, as they obviously spun their message correctly whereas Virgin and Delta seemingly did not. Regardless, I can't fathom how the DOT could justify BA/AA getting in bed together but have decided with Virgin and Delta to, um, keep things virginal apparently.

Same for the ACCC here. They claimed that a Virgin and Air NZ partnership "...would lessen competition and increase the likelihood of ‘‘coordinated conduct’’ on the trans-Tasman route." Apparently the US DOT doesn't think the same logic applies over there, as I'm sure there will be a fair bit of "coordinated conduct" between the Brits at Waterside and the Yanks at DFW.

And just to add more insult to injury, Qantas has now stated publicly that they have a beef with Virgin's proposed partnership with Etihad. Let's not even bother with discussing the merits of airlines objecting to other airlines' plans, shall we? Of course Qantas now has issues with Virgin's plans, but does anyone have any issues with Qantas' codeshares through to Europe with BA/CX, etc? Sorry, I just said I wasn't going to go there...!

Now, I'm not advocating that all governmental bodies charged with consumer protection around the world should operate under the same guidelines when it comes to regulating things like air travel. However, I would hope that they would operate with at least the same logic. And I for one find all these rulings illogical. After all, if there is any industry on this planet that is excellent at trying new ways to fill a void in a particular part of the market, it's the airline industry (see: Southwest, Ryanair, AirAsia...and yes, even Virgin Blue circa 2001.)

If Virgin and Air New Zealand do link up and decide to start doing anti-consumerish type things like charging $1500 one-way across the Tasman, I'm sure Qantas, Tiger, Emirates or any number of future upstarts will be ready to step in and bring that consumer back with lower prices or better service or whatever will woo the customer. So why do we need endless bureaucracy combined with a lack of common sense dictating the market?

Perhaps one day I will be paying $1500 one-way across the Tasman, standing up for the entire flight, and paying a fiver to use the toilet thanks to "coordinated conduct." And if that day happens, Cafe Patrons, I may have to charge extra for that lid on your morning cuppa...

EXTRA SHOT FOR THE DAY

I'll be in Hong Kong all next week through Friday, and thanks to a jam-packed schedule and some "renovations" I'll be doing on the Cafe, we'll be closed next Friday, September 25th. I'll be back open on October 1st with a whole new look - come check it out!

Image courtesy www.commons.wikimedia.org