Virgin Australia will now not be allowed to collude with Alliance Airlines on bidding for fly-in, fly-out routes for the useful resource sector after the competitors watchdog severed the five-year partnership.
The airways are the second and third largest suppliers of FIFO companies in Australia and the shortage of competitors may tempt them to cut back service high quality or increase flight costs, ACCC chairwoman Gina Cass-Gottlieb mentioned,
“The airlines have not demonstrated to us that there’s sufficient public benefit to outweigh the likely detriment from their proposed coordination,” she mentioned on Friday.
The partnership between Virgin and Alliance on flight bidding has been going for 5 years however the watchdog mentioned there have been no apparent advantages.
“The agreement to not compete for each other’s customers, while not always implemented to date, is also likely to reduce competition and incentives for the airlines to invest and innovate,” Ms Cass-Gottlieb mentioned.
The ACCC in November sought submissions on its draft willpower to disclaim an extension of the settlement.
From the submissions, the watchdog mentioned it discovered some help for the partnership however not sufficient to grant an extension to the five-year settlement.
Virgin Australia mentioned it was dissatisfied by the transfer, arguing the partnership offered “an enhanced service to FIFO customers in Western Australia and on the east coast”.
“Virgin Australia is committed to continuing to service its charter customers and we are working through the implications of this decision,” a spokesperson mentioned on Friday.
Source: www.perthnow.com.au
