Insights

Qantas (ASX:QAN) share price lower on ACCC update

The Qantas Airways Limited (ASX:QAN) share price is under pressure after the ACCC dealt it a blow this morning. Here’s what happened…
The post Qantas (ASX:QAN) share price lower on ACCC update appeared first on The Motley Fool Australia. –

qantas pilot putting hands to her face as if distraught

The Qantas Airways Limited (ASX: QAN) share price is under pressure on Thursday morning.

At the time of writing, the airline operator’s shares are down 1% to $4.76.

Why is the Qantas share price trading lower?

The Qantas share price is trading lower today after the Australian Competition & Consumer Commission (ACCC) revealed that it plans to deny the Qantas-Japan Airlines coordination proposal.

According to the release, the ACCC is proposing to deny authorisation for the two airlines to coordinate flights between Australia and Japan for three years under a proposed five year joint business agreement.

The ACCC’s Chair, Rod Sims, explained: “An agreement for coordination between two key competitors breaches competition laws. The ACCC can only authorise these agreements if the public benefits from the coordination outweigh the harm to competition. At this stage we do not consider that Qantas and Japan Airlines’ proposal passes that test.”

The competition watchdog notes that prior to the COVID-19 pandemic, Qantas and Japan Airlines were the only two airlines offering direct flights between Melbourne and Tokyo. They were also two of only three airlines offering direct flights between Sydney and Japan’s capital.

Mr Sims said: “The airline and tourism sectors have been severely impacted by the COVID-19 pandemic. Protecting competition in the airline industry is critical to ensuring recovery in the tourism sector, once international travel restrictions ease. This proposed coordination would appear to undermine competition significantly by reducing the prospect of a strong return to competition on the Melbourne – Tokyo and Sydney – Tokyo routes when international travel resumes.”

“Granting this authorisation would seem to eliminate any prospect of Qantas and Japan Airlines competing for passengers travelling between Australia and Japan, as they did before the COVID-19 pandemic. This elimination of competition would benefit the airlines at the expense of consumers,” he added.

The regulator also believes that Qantas and Japan Airlines combining their operations would make it more difficult for another airline to seek to launch flights on these routes.

What now?

The ACCC is now seeking submissions from interested parties in response to this draft determination by 27 May 2021. After which, it will make a final decision after consideration of those submissions.

Qantas has not yet responded to the news.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Qantas (ASX:QAN) share price lower on ACCC update appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!