Qantas shares maintain altitude amid 'historic' $5 billion deal

Qantas shares maintain altitude amid 'historic' $5 billion deal Woman on a tablet waiting in for her flight in an airport and looking through a window.

The Qantas Airways Limited(ASX: QAN) share price is down 0.7% after the ASX travel share announced an agreement with Perth Airport regarding upgrades and developments. The S&P/ASX 200 Index(ASX: XJO) is up 0.5%, so Qantas shares are underperforming the market today.

Perth is an important destination for Qantas because of Project Sunrise, with Qantas creating ultra-long-haul flights over the coming years. The long-distance flights will use Airbus A350s, which arrive in 2026.

$5 billion Perth Airport investment plan

Qantas announced a 12-year agreement under which Perth Airport will invest approximately $3 billion in new terminal facilities and a new parallel runway, which is expected to open in 2028.

Perth Airport's overall capital investment will total $5 billion, delivering two multi-storey car parks, major access roadworks, and the airport's first hotel.

Qantas and Jetstar will relocate all services to a new terminal in the Airport Central precinct, which will enable the growth required to turn Western Australia into a "major domestic and international hub" for the airlines. Qantas will also invest in new aircraft.

Jetstar and Qantas plan to add 4.4 million seats to and from Perth annually by the time the new terminal opens in 2031. As part of the agreement, Qantas plans to build a new engineering hangar in the precinct.

The airline said the upgraded hub will significantly enhance inbound tourism and give Aussies more options when travelling to Asia, Africa, India and Europe.

Perth Airport will also invest in upgrades to terminals 3 and 4, where Qantas currently operates, to create additional capacity while the new terminals are built. Jetstar will relocate its domestic services to terminal 2 from September 2024.

The upgrades to terminals 3 and 4 will allow Qantas to add more services and destinations from Perth, including Auckland and Johannesburg, from mid-2025, subject to meeting border agency requirements. The works will also include gate upgrades to accommodate the ultra-long-haul aircraft for Project Sunrise.

As part of the agreement, all outstanding commercial issues between Perth Airport and Qantas have been resolved.

Management comments

The Qantas CEO Vanessa Hudson said:

This is the largest airport infrastructure deal in our history. It will enable us to create a world-class western hub and significantly expand our domestic and international services over the short, medium and long term.

Not only will it allow us to bring hundreds of thousands more travellers to and through Western Australia each year, it will also make it easier for overseas tourists to connect to more destinations across Australia.

Perth-London and Perth-Rome are two of the most popular flights on our international network, which gives us confidence in our strategy to ramp up WA flying over the next few years as we receive new aircraft and grow our fleet.

Qantas share price snapshot

Since the start of 2024, the Qantas share price has risen 12%, as seen on the chart below.

The post Qantas shares maintain altitude amid 'historic' $5 billion deal appeared first on The Motley Fool Australia.

Should you invest $1,000 in Qantas Airways Limited right now?

Before you buy Qantas Airways Limited shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Qantas Airways Limited wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks*Returns as of 5 May 2024

More reading

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

  • https://www.msn.com/en-au/lifestyle/travel/qantas-shares-maintain-altitude-amid-historic-5-billion-deal/ar-BB1nmD9c?ocid=00000000

Related

Royal Palace Seafood Restaurant

Royal Palace Seafood Restaurant

Lifestyle
Chocolate treasure chest a must-try at Surry Hills’ new brasserie Armorica

Chocolate treasure chest a must-try at Surry Hills’ new brasserie Armorica

Lifestyle
Clam Bar

Clam Bar

Lifestyle
The 10 Queensland restaurants you need to eat at this year

The 10 Queensland restaurants you need to eat at this year

Lifestyle
14 Best Buzz Cut Hairstyles for Men: A Barber’s Guide

14 Best Buzz Cut Hairstyles for Men: A Barber’s Guide

Lifestyle
Cafe 143

Cafe 143

Lifestyle
‘Where should I go for lunch when I’m in Sydney?’: 10 budget-friendly spots to take every visitor

‘Where should I go for lunch when I’m in Sydney?’: 10 budget-friendly spots to take every visitor

Lifestyle
Striped shirts are back – but this time without the 80s City boy vibe

Striped shirts are back – but this time without the 80s City boy vibe

Lifestyle