Fiji Airways Managing Director and Chief Executive Officer, Andre Viljoen says Qantas Airways Limited which is the second-largest shareholder for Fiji Airways having 46 percent shares in the company has announced in January this year that it would commence its own services to Fiji in competition with Fiji Airways.
Viljoen says Qantas’ move is odd for a number of reasons like they have entered the market at a time when Australian visitor arrivals to Fiji are flat and the addition of Qantas services has created overcapacity and diluted yields.
He says through their codeshare relationship, Qantas has earned healthy codeshare commissions for little cost and risk.
Viljoen says by operating its own services, at its cost and risk, they estimate that Qantas will struggle to turn a profit on the route.
He says Qantas has recently indicated it will be increased from four flights per week to a daily service between Sydney and Nadi later this year.
Viljoen says Qantas’ sudden flip from ally to adversary has been very damaging for Fiji Airways as it is competing aggressively, actively directing passengers onto Qantas and Jetstar services.
He says it is difficult for a small Pacific Island national carrier to compete with the substantial market power and financial capability of Qantas which dwarfs the resources and capability of Fiji Airways.
Viljoen says Fiji Airways has met with Qantas on a number of occasions to voice their concerns but it seems that they have fallen on deaf ears.
He says Qantas has cited increased connectivity for its own passengers as a key reason for flying to Fiji, but their analysis has shown that, with the exception of some marginally improved connection times, the Qantas services do not create any meaningful new connections.
Viljoen says the aggressive competition by Qantas Airways is severely damaging Fiji’s national carrier and their ability to compete.
Meanwhile, Acting Prime Minister and Minister for Economy, Aiyaz Sayed Khaiyum says that they have an issue with Qantas which is Fiji Airways Limited’s second-largest shareholder having 46 percent stake in the company.
Sayed‑Khaiyum says Qantas is cannibalizing Fiji Airways.
He says they are hoping the issue is resolved in the next couple of weeks.
Qantas Airways Limited has been a shareholder in Fiji Airways since 1958 and actively participated on the board until 2012.