Drain the Qantas swamp

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The Australian Competition & Consumer Commission (ACCC) is pursuing legal action against Qantas over its alleged selling of tickets for more than 8,000 flights that were already cancelled.

The ACCC’s allegations against Qantas also relate to the timeliness of when it informed customers about their flights being cancelled, with the ACCC claiming that Qantas did not tell customers for weeks that it had cancelled their flights, sometimes for more than a month.

In filing its defence against the ACCC, Qantas claimed that customers are not buying a specific flight when they book to travel but instead a “bundle of rights” to fly, while the company has blamed its booking systems for selling trips it had already cancelled:

“In accordance with long-standing industry practice, Qantas prepares a core schedule of flights for each season … and makes airfares available for sale in accordance with that schedule”.

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“Nevertheless, both in offering those airfares for sale, and in its contracts with consumers, Qantas states explicitly that it does not guarantee flight times or flight schedules”.

“The ‘service’ Qantas relevantly offers is a bundle of contractual rights, which are consistent with Qantas’ promise to do its best to get consumers where they want to be on time”.

“That bundle of rights includes alternative options to which consumers become entitled in respect of cancelled flights, but does not include any promise to provide a ‘particular flight’ or to operate to a particular schedule”.

The ACCC’s actions against Qantas comes as several US Mega-funds declared that they plan to deliver a strike against the Richard Goyder-led board and vote down several directors, including former advertising boss Todd Samson.

I lambasted Qantas on Monday night’s interview with Sky News host Rita Panahi:

Below are some highlights:

“I think Qantas needs an absolute cleanout. Their behaviour since the pandemic and recently has been pretty poor”.

“I know personal friends who’ve basically had their flights canceled at the last minute. It’s completely stuffed their holidays. They’re not isolated examples. These sorts of things happen across the board”.

“Obviously, we had all the travel credit dramas and everything else”.

“I think the whole airline does need a cleanout, and I think that’s a good thing. I think the whole aviation industry in general needs more competition”. 

“We should be opening up flight routes, etc. Let them compete. Don’t give them this sort of sheltered workshop. You know, this protection racket”.

“I’m all for it. Clean them out. Take out the trash”.

Drain the Qantas swamp and subject the airline to more competition.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.