Australians planning a holiday this summer will pay more for domestic flights after Qantas announced a 4 per cent price rise to economy fares.
The new rates, effective from September 29, affect base fares across Qantas’ entire domestic network.
Qantas-owned subsidiary Jetstar increased its domestic fares by an average of 3 per cent, also on Thursday.
Ivona Siniarska, a travel industry expert for 1000 Mile Travel Group, shared her disapproval of the price increase on LinkedIn.
“Absolutely baffling that they would be increasing their fares even further while popularity is at an all-time low,” Ms Siniarska wrote.
“If somebody increases their service fees you expect a certain standard and level of service to continue,” Ms Siniarska told TND.
“It seems that Qantas increases fares while decreasing the support and the network support they offer. So I’m not sure where that increase is being moved along,” she said.
“Travelling with Qantas has become increasingly frustrating and less dependable for simple domestic routes.”
Earlier in the year, Qantas fell out of the top five rankings for the world’s best airlines amid a massive wave of customer dissatisfaction.
In August, airline boss Alan Joyce apologised to customers and assured the public the national carrier was “working hard to get back to our best”.
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Alan Joyce Qantas - frequent flyers August 2022
Qantas CEO Alan Joyce apologises to customers for the airline's poor operational performance.
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When contacted for comment, Qantas referred TND to comments made by ACCC Chair Gina Cass-Gottlieb in early September: “After about 18 months of historically low airfares, the cost of domestic flying has risen sharply in response to strong demand, temporary capacity reductions and very high jet fuel prices.”
Qantas fuel costs for the 2023 financial year are expected to be $5 billion, about $1 billion more than 2019, an approximate 60 per cent increase in fuel prices compared to the 2019 financial year.
Other Australian airlines are expected to follow Qantas’ lead and pass the burden of soaring fuel costs to consumers, aviation experts said.
Professor Rico Merkert, chair in transport and supply chain management at the University of Sydney, said the increases are probably due to rising CPI levels, industrial action (which raises staffing costs), the relatively strong USD capital costs (for aircraft), and the price of fuel.
“If all airlines are raising fares, then the consumers will have no choice but accept the fare increases … it should be possible, assuming that wages will go up by the same amount,” he said.
“If that does not happen, people will have less disposable income to spend on flying.”
A spokesperson for Qantas’ rival, Virgin, said a number of factors put pressure on airfare prices, including high levels of demand, inflationary pressures, and sustained high fuel costs.
“We review and adjust our fares in line with these factors,” a spokesperson said.
“We are firmly focused on continuing to provide the best possible value and choice to our customers.”
Hitting the road again
In an email to TND, a spokesperson for regional airline Rex advised that the airline had implemented two fare increases in the past six months and could not rule out further increases due to increased operating costs.
Due to limited supply, increased prices, and sold-out flights during popular holiday periods, some people’s domestic travel habits are shifting.
“I’ve had travellers who, instead of flying from Melbourne to Sydney, have decided they’re better off driving,” said Ms Siniarska.
“It’s cheaper to consider driving and stopping along the way at a motel for, you know, $150 a night and making an adventure out of it.”
