Qantas is acting above the law and Jetstar should be hived off, says airport boss

Canberra Airport chief Stephen Byron has accused Qantas of “acting above the law” in its domination of the domestic market and called for Jetstar to become an independent carrier.

Canberra Airport chief executive Stephen Byron has accused Qantas of “acting above the law” in its domination of the Australian aviation industry and urged the federal government to intervene.

Mr Byron was giving evidence to a Senate committee inquiry into bilateral air rights which is examining the government’s decision to deny Qatar Airways additional flights into Australia, and Qantas’s role in that.

Mr Byron said Qantas had repeatedly demonstrated that “unless forced by a regulator or the highest court in the land they would do what they please”.

He highlighted the lack of competition in the market, emphasising that the “friendly duopoly” between Qantas and Virgin Australia was not friendly to ­consumers.

“The biggest indicators of the lack of competition between the two airlines who control 95.1 per cent of the market are the sky-high airfares, record profits and the extraordinary cancellations and the problems with booking fares using airline credits,” Mr Byron said.

He suggested remarks by former Qantas CEO Alan Joyce that Rex and Bonza were providing intense competition “were deceptive and misleading”.

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Rex has eight 737 aircraft in operation and Bonza with its four 737s has chosen to fly almost exclusively on routes where it does not compete with Qantas or Virgin,” he said.

“Rex and Bonza provide a valuable alternative for a small number of consumers but they are not an effective competitive force to the Qantas/Virgin ­duopoly.”

Mr Byron said it should be a policy imperative of the Australian government to help facilitate a “competitive third independent airline” in the domestic market.

He called for the ownership and operation of Jetstar to become independent of Qantas to help put downward pressure on fares and increase competition.

His comments came as Rex announced further reductions to its regional services, as a result of “relentless pillaging” of its pilots by the major carriers.

The routes affected were serviced by Rex’s fleet of 57 Saab 340s, 19 of which have been parked since late April.

They included Sydney to Albury, Griffith, Coffs Harbour, Narrandera, Orange, Parkes and Port Macquarie. In addition flights between Sydney and Mildura were being suspended, and Rex was withdrawing from Cairns-Bamage.

Rex noted that service reductions on seven other regional routes announced in April would continue for at least another five months, as would the suspension of flights between Adelaide and Mildura.

“Unlike other carriers, we prefer to reduce the scheduled services so that our passengers can be assured of fewer disruptions and more reliable services,” Rex general manager of network strategy Warrick Lodge said.