Article: Qantas Expects International Airfares to Come Down

[AFF Editor]

Qantas Expects International Airfares to Come Down is an article written by AFF editorial staff:

Qantas Expects International Airfares to Come Down

While the high international airfares are causing temporary pain for travellers, the good news is that these won't stick around forever.

www.australianfrequentflyer.com.au

You can leave a comment or discuss this topic below.

 

[eminere]

Lols nice try Qantas but I'll believe it when I see it.

 

[FlyingKangaroo]

Lols nice try Qantas but I'll believe it when I see it.

+1.

This after he announced international airfares were going up 20% across the board a few months ago just because. They certainly did, too, and on the key routes I travel, it meant fares that were already a solid 30-50% higher than their competitors became even more uncompetitive.

I've flown half a dozen airlines internationally in the last three months and Qantas hasn't been one of them. Oh well.

 

[mrsterryn]

What is the point to Qantas making such a comment ? To get people to wait and not book with cheaper competition? I actually don't get it especially if Qantas doesn't come down in price

 

[kpc]

Wouldn't believe a word that comes out of Qantas marketing spin!

 

[dylarr]

What is the point to Qantas making such a comment ? To get people to wait and not book with cheaper competition? I actually don't get it especially if Qantas doesn't come down in price

Meeting their obligations in keeping shareholders updated. The forecasted decrease in RASK$/yields due to extra international capacity coming online (both QF and non-QF) must be material enough that they've seen fit to call it out in their market update.

 

[mrsterryn]

Meeting their obligations in keeping shareholders up-to-date. The forecasted decrease in RASK$/yields due to extra international capacity coming online (both QF and non-QF) must be material enough that they've seen fit to call it out in their market update.

But ...unlikely to be true ? I would have thought shareholders would love continuing high prices ?

 

[dylarr]

But ...unlikely to be true ? I would have thought shareholders would love continuing high prices ?

I don't think it's a matter of QF saying they are willingly decreasing fares as they'll continue to charge as much as customers are willing to pay... I think they're saying that forecasted change in market conditions (i.e. extra capacity) will force fares down and as such they are expecting RASK$/yield performance to decrease.

 

[Cruiser Elite]

NFI from me - but from where I sit prices could well explode if China opens up given capacity increase restrictions all airlines in all countries are confronted with - time will tell - will be so interesting to look back at end 2023 and 2024

 

[mrsterryn]

Ok so I am confused...are prices likely to come down across the board (I didn't think so taking into account poor AUD at the moment, petrol issues etc ) or are they likely to increase notwithstanding Qantas take on this ?

 

[mviy]

All else being equal QF and competitors putting on more capacity should drive prices down.

Obviously unfavourable moves in exchange rates, fuel costs, demand possibly increasing faster than supply etc. could counteract the impact of increased capacity.

Not all routes are equal. There will be more competition on some routes than others affecting what QF is able to get away with charging.

 

[clifford]

All else being equal QF and competitors putting on more capacity should drive prices down.

Obviously unfavourable moves in exchange rates, fuel costs, demand possibly increasing faster than supply etc. could counteract the impact of increased capacity.

Not all routes are equal. There will be more competition on some routes than others affecting what QF is able to get away with charging.

I don't see prices coming down in the short term

 

[Saab34]

I don't see prices coming down in the short term

I don’t think much will change for the next year at least.

Doubt we will see much growth on the domestic front, the margins they are getting at the moment are off the charts clearly. People are paying whatever, including me who had to buy some outrageously expensive last minute fares recently but what exactly is the other option.

The only extra aircraft arriving appears to be Virgin and MAX aircraft next year. Rex said they will try and add 2 later next year.

If you’re wanting to travel peak, book well ahead. If you’re after a longer haul domestic last minute, expect to be taken to the cleaners.

 

[JohnK]

Would love to see it but I think airfares will stay high for quite some time.

Just look at the current options to get to SIN-BKK etc on Skyscanner, Webjet etc.

 

[AustraliaPoochie]

Nearly $8k for Au - Japan in J this year with QF.
CX asking $6.5k.
Pure cash rev fare.
My QFF points are not high enough to burn on reward redemption seats.

 

[dajop]

On SQ, about 2-3 weeks out SIN-MEL/SYD return in J are going for about $8K SGD return ($9k AUD), If you can even get seats.

Surely this has to go down eventually.

 

[jb747]

Three new 787 vs the permanent loss of 2 A380s equals a net loss of about 200 seats.

 

[levelnine]

Funnily enough, the media are reporting the exact same capacity figures as indications of prices going up, not going down:

Total seat volume on inbound flights is stuck at 59 per cent of 2019 levels, and isn’t predicted to hit 76 per cent of pre-pandemic figures until the second quarter of 2023, analysis by Tourism Australia shows.

Capacity restraint and fuel costs continue to push up the cost of air travel, with flights over the December/January festive season hitting up to $6000 one-way in economy (and about $10,000 in business class) on a full-service carrier between Australia and cities such as New York, London and Paris.

It’s bad news for Australians needing to head overseas for Christmas to visit family and friends, or simply desiring a holiday abroad.

Making it even worse, Tourism Australia is spending millions of dollars trying to pump up demand into Australia:

“Every country is fighting harder than ever for travellers. It’s incredibly competitive out there,” Ms Harrison told The Australian Financial Review before departing on Sunday for the United States’ campaign launch, which includes a takeover of the 23-metre “Godzilla” billboard in New York’s Times Square – one of the most popular locations in the world for social media posts.

“Arrivals into Australia continue to go up,” she said. “I get asked: ’Why are we doing a demand generating campaign now when they aren’t enough airline seats and staffing is still an issue [for tourism businesses]? My response is this is a two-year, long-term campaign. We’re building awareness for the future.”

Long-haul flights hit $6000+ for economy one way over festive season

Airline prices continue to rise heading into Christmas - if you can even get a seat. But that hasn’t stopped Tourism Australia from launching its biggest global tourism campaign since 2016.

www.afr.com

 

[Saab34]

Finance Departments in Airlines will be having a field day. How long can we milk the public and keep margins climbing they say.

 

[Ragtrade1961]

The prices being charged by Qantas right now are insulting. I’ve been a loyal member for 25+ years (G,P,P1) and for the very first time moved over to another carrier for December flights to USA. Qantas want 14,500 business each way so that’s basically 60K for two. United’s newer business product is 8,800 RETURN! To get that fare, we need to take a quick trip JFK to Switzerland for a couple of days but hey, we saved 44K and that will more than cover a very nice hotel in Zurich and a trip to visit the Alps! Also now doing interstate flights on virgin because they are a fraction of the price of Qantas. How can this be justified. It’s gouging. I feel like a traitor but what else can I do?