Qantas Airways Not Considering Merger

CANBERRA, Australia (AP) -- Australia's largest airline Qantas Airways said Monday it is not considering a merger with Singapore Airlines, despite the Australian trade minister raising the prospect.

The Australian newspaper reported Trade Minister Mark Vaile had backed a merger between the airline rivals.

''We understand the minister was talking about a hypothetical situation,'' Qantas said in a statement. ''Consolidation is already happening in other areas of the world and we support moves to allow consolidation in this region.''

''However we have no plans on the table for consideration,'' Qantas added.

Qantas last week won a reprieve from the Australian government over Singapore Airline's bid to compete on the lucrative route between Australia and the U.S. west coast. Singapore Airlines was denied access after the Australian government found the timing was not right to allow increased competition.

Vaile told the newspaper Australia should not rule out the possibility of a merger between Qantas and Singapore Airlines.

''My view is if (a merger) could occur then the government should not rule that out,'' Vaile told the newspaper for its Monday edition. ''Quite frankly, that is the direction that international aviation is moving in.''

No more than 49 percent of the former state-run carrier is allowed to be foreign owned, but its managers have long lobbied Canberra for that restriction to be dropped.

Vaile said Qantas is facing serious commercial challenges and the government ''needed to ensure Qantas isn't exposed to unfair competition.''

Singapore Airlines spokesman Stephen Forshaw said such a merger was unlikely and that it would not be in passengers' interests.

''The proposal for Qantas and Singapore Airlines to merge, as outlined by the Australian Trade Minister, and welcomed by Qantas, will do nothing to satisfy consumers who want more competition and choice on the trans-Pacific route,'' he said.

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