Qantas and Australia Post sign new contract for international mail

Qantas Freight chief executive Gareth Evans said it was a “substantial contract to secure”.

“We have transformed Qantas Freight to deliver flexible and efficient operations for the changing needs of our customers,” Evans said in a statement.

“This partnership sees the Australia Post Group and Qantas Freight well-positioned to support the e-commerce industry, which relies on air freight for express delivery of its steadily increasing volumes of international packages and parcels.”

Under the contract, the 1,500 international flights operated by the Qantas group of airlines will continue to carry Australia Post’s international letters and parcels. Further, Qantas Freight’s interline agreements with other carriers would “ensure the Australia Post Group has world-wide access” for the 12,000 tonnes of parcels.

The contract extension for international air freight followed the signing of a five-year agreement in 2015 for Qantas to carry Australia Post’s domestic mail, parcels and Express Post until the mid-2020s.

And in May 2016, the airline established a dedicated sub-fleet of six freighter aircraft to deliver domestic mail, parcels and Express Post for Australia Post and its subsidiary StarTrack comprising two Boeing 737-300Fs and three BAe 146-300Fs from Qantas’s existing freighter fleet, as well as a new Boeing 737-400F branded with StarTrack livery.

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Meanwhile, Qantas Freight also operated one Boeing 767-300F and two Boeing 747-400F freighter aircraft on international routes. The 747 freighters were operated by Atlas on behalf of Qantas.

Qantas, Australia Post and StarTrack have a long history of cooperation. Qantas and Australia Post formed domestic air freight operator Australian air Express in 1992 as a 50:50 joint venture, while in 2003, again as 50:50 partners, they acquired courier delivery company Star Track Express. In 2012 Qantas sold its share of StarTrack to Australia Post, and in turn acquired Australia Post’s 50 per cent share in Australian air Express.

StarTrack chief executive and executive general manager Bob Black said the partnership with Qantas was “important for our customers”.

“This strategic alliance – combined with our global reach through existing partnerships with key ecommerce platforms, postal and freight providers – will help Australian businesses and consumers buy and sell goods internationally with confidence, and complements our unrivalled domestic capability,” Black said.

Qantas said at its 2016/17 results presentation in August its freight business suffered a 44 per cent drop in underlying earnings before interest and tax to $64 million, which the company said reflected flat cargo demand amid a six per cent increase in global cargo capacity.

Meanwhile, Virgin Australia commenced its cargo operations with dedicated freighter aircraft ferrying parcels, food, documents and machinery for its major customer TNT and other clients in July 2016.