Australia’s competition watchdog, the ACCC, said domestic air fares in the country are well above pre-pandemic levels, but airlines have not raised fares.
Be the first to receive relevant news by subscribing to the Airlineratings.com newsletter
Stunning supersonic flyover video
Incredibly wobbly landing of a Ryanair 737
Spectacular Emirates A380 and Red Arrows flyby
The company’s latest Airline Competition in Australia report said average revenue per passenger (which shows the average airfare across all fare types) was 27% higher in October 2022 than in October 2019. I’m here.
ACCC Commissioner Anna Blakey said: “Strong demand and supply constraints on travel have pushed up airfares as airlines scaled back schedules in response to high jet fuel costs and operational challenges.
Among the various fare types, discounted economy fares have seen the most growth, according to the ACCC. That’s because airlines don’t currently have to offer special fares to fill their planes due to low flight numbers but high demand.
The index of discounted economy fares on Australia’s top 70 domestic routes in November 2022 was more than double its 11-year low in April 2022. In September of this year, the same index for the cheapest available fares hit his 15-year high.
“Historical lows and highs in discount air fares in the same year show how volatile this market can be as the industry recovers from the pandemic,” Blakey said.
“While airlines acknowledge that they still have pandemic-related resource issues, the ACCC will carefully monitor them so that it can return capacity to the market in a timely manner to begin easing pressure on air fares. I will monitor.”
“We would be concerned if airlines withheld their ability to keep airfares high,” Blakey said.
Flexible economy and business fares have not increased as much as discounted fares and are below pre-COVID-19 prices as of November 2022.
The ACCC said the airline is forecasting positive financial gains on the back of strong demand and high airfares after substantial losses from the pandemic.
He added that Qantas Group, Virgin Australia and Rex expect to be profitable in the current financial year ending June 2023. This is close to his one-year operating record for the company.
According to the ACCC, this winter saw a spike in flight cancellations and delays, as airlines dealt with high rates of staff illness, labor shortages and supply chain disruptions.
The report also highlights that while employee absenteeism is declining, the industry continues to grapple with labor shortages and supply chain issues. There is also uncertainty about how her recent rise in COVID-19 cases will affect the industry.
“For the summer holidays, airlines have said they have additional crews and aircraft on standby to minimize delays,” Blakey said.
Jetstar, Qantas, Rex and Virgin Australia have canceled 2.9% of domestic flights in October 2022. It was down from 6.4% in July and closer to its long-term average of 2.1%.
ACCC found that about 31% of all flights were delayed in October. By contrast, the long-term average is about 18%. Qantas and Rex had the lowest flight cancellation rates in October, and Qantas had the highest on-time performance rate among the airlines.
“Airlines have significantly improved reliability after historically low levels over the winter. However, flights are still regularly delayed,” Blakey said.
The report also explores the key factors affecting airfare, showing that the level of competition on a particular route is a key factor in determining what consumers pay. Other important factors are when bookings are made, ticket demand and the airline’s corporate strategy.
“In the current climate of skyrocketing airfares, competition is more important than ever in keeping prices in check and giving consumers more choice,” Blakey said.
