End of cheap deals? Qatar Airways and British Airways sign Joint Business Agreement

Qatar Airways and British Airways unveiled a ‘joint business agreement’ yesterday covering flights between the UK and Doha.

What this means, in simple terms, is that all revenue generated from Qatar and BA services to Doha is put into a big pile and then shared out between them according to a pre-agreed formula.

British Airways and Finnair have a similar deal with Japan Airlines covering Europe to Japan routes, and of course there is the massive AA / BA / Iberia / Finnair deal covering flights to North America.

All Qatar Airways flights from the UK will carry a British Airways flight code, and vice versa, from 30th October.

Is this good for customers?

Qatar Airways said yesterday:

“The joint business will benefit customers by offering a wider choice of flights, an enhanced network, greater choice of fares and superior benefits for members of their frequent flyer programmes.”

However, ask yourself this question.  If Tesco and Sainsbury agreed to match their prices on every single product and co-ordinate store openings so that they no longer competed directly with each other for the same customer, would this be a good thing?

Does this mean the end of Qatar Airways deals from the UK?

Good question.  It certainly won’t have any impact on Qatar Airways pricing from the rest of Europe.

However, any Qatar Airways deal from the UK will now have to be available across British Airways services too.

Let’s say that Qatar Airways offers a £1,750 fare from the UK to Sydney.  You would be able to book this, for the same price, using British Airways to get to Doha before you switch to an onwards Qatar Airways flight.  The yield on this flight will be very low for BA although, due to revenue pooling, it doesn’t actually matter to BA whether you are on a BA or Qatar Airways aircraft.

Of course, you would have to be pretty mad to voluntarily fly British Airways in Business or First Class to Doha when a Qatar Airways alternative is available …..

As the State of Qatar is now the biggest shareholder in International Airlines Group, the parent company of British Airways, this deal is not a surprise.

The best Qatar Airways sale deals were always out of continental Europe anyway, so hopefully nothing will change here.

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