With several attempts to restart travel weighed down by border restrictions, Qantas’ third quarter trading update showed demand remains strong.
On the local front, fourth-quarter financial year 2022 and first quarter financial year 2023 capacity is expected to represent 105 per cent and 110 per cent of financial year 2019 capacity, respectively as people resume travel with international flights set to take-off.
Taking a bit of interest was the news around establishing direct flights between Australia and cities like New York and London earmarked for late 2025. Project Sunrise, the company’s name for the plan, is set to deliver 12 aircrafts over the financial years 2025 to 2028.
Meanwhile, the flying kangaroo also unveiled its agreement to fully acquire Alliance Aviation Services
(ASX:AQZ) in an all-scrip deal, valuing Alliance at $4.75 a share.
A couple of things to note is that Qantas is already a 20 per cent stakeholder as of February 2019, which means the deal is to buy what Qantas doesn’t already own.
The offer is pending the usual regulatory approvals, although the news shouldn’t be a surprise to the Australian Competition and Consumer Commission (ACCC) as at the time of the deal in 2019, Qantas flagged its long-term interest in buying out the airline. During their investigation, they made no findings that it lessened competition.
Alliance has about 70 aircraft and 500 staff with the acquisition set to launch Qantas’ competitive position in the charter market, while improving the service in the resource spots of Western Australia and Queensland.
The news comes after Regional Express
(ASX:REX) inked a deal with US airline giant Delta Airlines to access each other’s networks. Delta’s flights to Sydney are set to connect to more than 60 Rex routes in Australia.
Shares in Qantas
(ASX:QAN) closed 2.7 per cent lower on Friday to $5.50, up 6.8 per cent for 2022.
Shares in Alliance Aviation Services
(ASX:AQZ) closed 2.6 per cent lower on Friday to $4.14, up 1 per cent for the year.
Shares in Regional Express
(ASX:REX) closed flat at $1.24 on Friday, down 11.7 per cent for the year.
