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Plans by low-cost international
contender Backpackers Xpress were dealt a blow yesterday after the International
Air Services Commission issued a draft ruling giving Qantas all available
capacity on the India-Australia route.
Brisbane-based BPX,
which wanted to fly all-economy jumbo jets from Britain to Melbourne via
Delhi and Bangkok later this year, vied with Qantas for 2100 seats a week
available to Australian carriers on the India route.
But the IASC found
BPX was not far enough through the regulatory process and concluded the
proposed airline was "not reasonably capable of implementing its
application at this stage".
It found the public
benefit on the India route was likely to be maximised by the allocation
of all available capacity to Qantas.
Qantas plans to start
three services a week to Mumbai from September and could introduce an
additional two services as early as next April.
"The commission
is aware that allocating all the India capacity to Qantas closes off the
possibility of Backpackers Xpress operating via Delhi as proposed, at
least until additional capacity is negotiated under the air services arrangements,"
the commission said in its determination.
"However, the
commission notes that the Department of Transport and Regional Services
is seeking air services discussions with the Indian aeronautical authorities
as a matter of course."
The commission left
the door open for BPX to reapply if additional capacity was secured on
the route.
It also noted that
the airline could still operate via Bangkok to Britain and Germany, providing
it could prove it could obtain the necessary approvals and was capable
of implementing its application.
The commission normally
seeks Transport Department advice on whether it considers a new airline
to be reasonably capable of obtaining the necessary approvals.
"In this case,
the commission understands that Backpackers Xpress has not initiated a
formal process for obtaining an international airline licence but has
started the process for obtaining an aircraft operator's certificate,"
it said.
Yesterday's decision
came after Minardi Formula One racing boss Paul Stoddart said last week
he was in talks with BPX to enter the Australian aviation market.
Mr Stoddart said his
European Aviation Air Charters could provide the 747s for BPX's low-cost
service.
The Minardi boss delayed
plans for a domestic Australian start-up because of worries about the
effect of Qantas's low-cost offshoot Jetstar.
A reorganisation of
European Aviation also resulted in 80 per cent of its workforce being
sacked.
Mr Stoddart said that
reaching an agreement with BPX would take at least another two months.
BPX officials were
unavailable for comment yesterday.
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