QANTAS MEDIA RESPONSE

STATEMENT ON AFR ARTICLE 18 November 2013

Qantas confirms it has contacted Federal and State governments to express concerns as the national carrier about potentially damaging shifts in Australias aviation industry. The recent announcement by Virgin Australia that it would receive more than $300 million in further capital from three government-backed airlines highlights the uneven playing field created by existing policy settings. Qantas is a world-class airline, employs over 30,000 Australians and continues to be the carrier of choice for many, but is subject to a unique set of limitations around foreign capital with no corresponding concessions. Virgin Australias proposed capital raising could see its foreign ownership rise to more than 80 per cent without the need for any further regulatory approval. Despite this, the airline would retain all the traffic rights given to Australian carriers. If wholly privatised, Virgin Australias ability to receive potentially unlimited capital from its government-backed owners would seriously distort the domestic aviation market for the benefit of foreign interests. The decision of these shareholders to invest in Virgin Australias loss-making strategy highlights that these airlines arent subject to the same commercial realities as Qantas. We have asked Federal and State governments to fully examine the motives behind the virtual takeover of Virgin Australia by foreign airlines, and to prevent destabilising of the domestic aviation industry, local tourism and jobs.

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