Can anybody tell me how they get away with it.

[JeniSkunk]

Straitman, firstly working from memory, there was a report in the Murdoch press in summer 2007/2008, about fares MEL-LAX being at the time near on $1000 dearer for AU on the same airline and same class than LAX-MEL, as for airline in the report, Qantas, I think. As far as I can recall, the report did not say wether or not exchange rates at the time were factored into what they reported.
Secondly, it is common knowledge on the Whirlpool broadband forums about the prices; excluding taxes and factoring in exchange rates; both here and abroad for IT items being far more expensive here than abroad.
I do uderstand that the ACCC has no power over the pricing policies of foriegn companies selling to Australia, however, that nothing is attempted to be done to redress the known pricing imbalance here in Australia has me wondering why.

Jenifur Charne

 

[anat0l]

I don't see this as a rort. It is just market dynamics at play, and unfortunately AU are at the less favourable end of the scale.

A rort may exist if all of the companies operating flights out of AU were colluding for price fixing.

Are you submitting that the government should regulate the industry and force it to charge the same price for sectors to and from other countries (e.g. a BNE-SIN round trip would need to cost the same as a SIN-BNE round trip)? If such a regulation was put in place, I would hope this would apply to all airlines, not just Australian ones. The government, in its wisdom, can do whatever it wants and contractually force any airline operating in and out of Australia to conform with this regulation, and this is no exception.

I suppose a case can be made that airlines are currently charging too much with respect to the cost of services provided, i.e. similar to how banks were charging too much in fees with respect to banking penalties (and the costs of administration of these). Can you imagine the government enforcing a "right to reasonable cost with modest profit" order on airlines and trying to apply these to premium class travel? I think that would be a riot.

The only reasonable and realistic way I see prices being driven down is by market dynamics created by the industry itself, such as an airline operating a route and having standard lower prices than the rest of the market and forcing its competitors to lower prices or improve services in order to remain competitive and retain business.

I think the incorrect use of 'rort', 'rip off' and similar terms is widespread and immoral. For example, before VA arrived, QF did charge higher prices for Trans-Pacific travel but that was because it was just exacting more out of the otherwise pale market on those routes. When VA came along and immediately (and now continuously) set lower standard prices for travel, most people were quick to accuse QF of being rorters and rip-off artists for a long time, when this was not the case - QF were simply pricing according to the market conditions and now were having to deal with new conditions (which they did - QF prices are now lower on Trans-Pacific). What it all boiled down to really was that the majority of the travelling public based their decision of "reasonable" cost of travel on actually the lowest cost for a "reasonably equivalent" service, and anything higher than that was defined as a rort/rip-off. I don't think that's correct.

 

[easygeld]

In simple terms the Australian People need to wake up and stand up to the airlines and make better choices. To allow this type of rort for all these years is crazy..!!

It's also about time the airlines stopped taking advantage of people in countries like Australia and maybe 1 Airline will stand aside and be the first to treat consumers fairly, instead of using their corporate size to manipulate the communities in a legal rort, although the Australian Government should regulate the airlines to say if you want flying rights here in Australia then you treat our people fairly and not rip them off, or subsidize other markets with our Australian dollars.

It's simple... The consumers need to remember "without customers, the airlines do not fly", & the airlines need too consider who is important and vital to their ongoing business "The consumer", so I think until the people stand up and say "NO", we will not be ripped off...then the airlines will continue too enjoy taking the Australians hard earned money.

Wake up Australia, you do not have to accept this type of behavior from airlines !!!

The ex Australian market is relatively expensive when compared to those for many other countries.

Even Oz-NZ r/t is ~$50 in general more expensive than NZ-Oz at the cheapest levels.

Yesterday I booked on Air NZ LAX-AKL-MEL r/t for USD896 all up. Departure from LAX is in early November, return in February.

This will link up nicely with the USD940 fare I booked several months ago on Qantas from LAX to MEL with departure last Sunday, returning in late October.

I travelled to LAX a week ago on another separate fare. I now have to arrange further travel back to melbourne for Feburay, but need to discern when I wish for subsequent travel.

Of course this only works if you plan to travel round trips on the same general overseas destination more than once per year.

 

[trooper]

So.. after you get the "gubmint" to regulate airfares the way you want them... can they then turn attention to whatever industry YOU are in?

I'm sure the end-users of whatever products or services you are involved in producing would like to receive those at "world lowest" prices too.....

I know, I know.. "thats different!"...:shock:

Back On Topic.. I DON'T pay these fares! Like serfty I find ways around them... and in fact tend to get myself up to SEA and fly on cheap Biz fares from there....:mrgreen:

If it is all too much trouble to take the relatively simple steps involved with my methods - or serftys - to AVOID paying more, then I wonder at the actual level of "outrage"....

 

[markis10]

Secondly, it is common knowledge on the Whirlpool broadband forums about the prices; excluding taxes and factoring in exchange rates; both here and abroad for IT items being far more expensive here than abroad.

Common knowledge among the whirlpool forums generally means schoolyard talk, most of the participants on that forum on young IT aware school attendees, I am a rep on that board

I have also in the past worked for a multinational in IT that made chips, and I am aware that selling product locally meant we had taxes that were imposed locally that added to the price locally, as a local purchaser you are paying for the local company tax etc, so yes prices are going to be higher than that in a country with lower corporate tax rates as an example.


Should we be taking to the courts companies that sell oranges dearer than we can buy them from the local farm???? Has anyone heard of supply and demand, do we not expect to pay for those lovely A380 ads on TV in our fares, are we forced to fly the one airline to LAX, no, we have competition, after all you can go to LAX and beyond for $750 return with United in August - thats competition .

 

[anat0l]

To look at it from the angle of those who think the Government should actively enforce airlines charge the same amount for from-AU flights as they do for to-AU flights... it is well within the Government to do this and (not exclusively to Australia) there has been a lot of regulation in the airline industry before with respect to fare levels, prices, availability, etc. etc.

After all, the government does keep an eye on the prices of items to some degree. Otherwise, why couldn't, say, the dairy industry arbitrarily force everyone to pay high prices for milk? Demand for milk isn't stark low at all and people do need it (more than a flight overseas I would imagine).

I can see however the industry complaining that it would be anti-capitalist if such regulation were in place.

 

[dajop]

[start rant]

I really don't understand the fuss. NO ONE IS FORCING ANYONE TO PAY THESE FARES. If people think they are being rorted SIMPLE DO NOT PAY THEM AND DON'T GO. If enough people do this the fares will drop, sure enough. If people are that concerned there are ample strategies, that can be researched on this very website, to mitigate costs and get the best bang for the buck, ranging from picking up fares outside Australia, doing "nested" returns, using Air Asia and Jetstar etc. I really don't understand the fuss. Go back to 1990 and try and buy MEL-SIN fares for $250 return (which in real terms, what they were selling for last year). This year - due to increased demand, not any rorting - the equivalent fare is double that, and the flights are pretty full.

At the pricing level provided, I assume the OP's post was about First Class. What the? Why should the government regulate the price of first class travel. If people don't want to pay the price of FC go business, premium economy or economy; or don't go at all.

Sorry but look at the situation when domestic travel was heavily regulated by the government. Fares were much more expensive for everyone. Is that what we want to go back to?

[\end rant]

 

[mark62]

Lets remember the airline industry is not like other industries because the Government controls who can and can't participate in the market. They are not allowing any non-Australian or US carriers to fly NA-AUS and hence fares are considerably higher than they otherwise would be with unlimited competition.

Fares are lower in the EU because there are open skies agreements - any carrier can fly to and from anywhere. Allow that here and flight prices would drop like a stone.

Qantas isn't one of the world's most profitable airlines due to some magic: its because competition to its business is carefully and comprehensively regulated by the Government. Name any other industries where that happens.

 

[Dave Noble]

\

It's simple... The consumers need to remember "without customers, the airlines do not fly", & the airlines need too consider who is important and vital to their ongoing business "The consumer", so I think until the people stand up and say "NO", we will not be ripped off...then the airlines will continue too enjoy taking the Australians hard earned money.

Not all fares are identical across carriers. When making a booking, do you check all the carriers and pick the best value or do u blindly choose the same carrier or alliance and book them regardless of the fare?

Whilst people will pay inflated fares on some carriers despite other options, then the airlines will keep the fares up

Dave

 

[Dave Noble]

Lets remember the airline industry is not like other industries because the Government controls who can and can't participate in the market. They are not allowing any non-Australian or US carriers to fly NA-AUS and hence fares are considerably higher than they otherwise would be with unlimited competition.

Fares are lower in the EU because there are open skies agreements - any carrier can fly to and from anywhere. Allow that here and flight prices would drop like a stone.

But when it comes, say, to travel to and from Australia , the same carriers fly from Europe to Australia as fly from Australia to Europe. The fares are based on what the market will bear in each direction

Dave

 

[serfty]

... They are not allowing any non-Australian or US carriers to fly NA-AUS ....

Actually, this is not true. Air NZ has Oz/NA rights and indeed has flown direct in the past.

However, these days (with a nod and a wink to UA I surmise) they choose not to, routing all their bookings though AKL.

 

[odysseus]

What it all boiled down to really was that the majority of the travelling public based their decision of "reasonable" cost of travel on actually the lowest cost for a "reasonably equivalent" service, and anything higher than that was defined as a rort/rip-off. I don't think that's correct.

Oh, so very true.

It's easier to complain, rather than think about the cause of things. There's also a lot of selective comparisons that go on, e.g. compare the hot bargain you hear about elsewhere with the day to day price that exists when you want to look at something here, and ignore the more expensive journeys elsewhere that don't fit the preconceived notion.

 

[mark62]

Actually, this is not true. Air NZ has Oz/NA rights and indeed has flown direct in the past.

However, these days (with a nod and a wink to UA I surmise) they choose not to, routing all their bookings though AKL.

Okay sorry only Australasian airlines and NA airlines have rights on that sector. But allow Air Asia to fly that route then see what happens to prices.

 

[odysseus]

Okay sorry only Australasian airlines and NA airlines have rights on that sector. But allow Air Asia to fly that route then see what happens to prices.

I'm not sure much. QF, BA, Emirates and so on fares to Asia and Europe are still pretty similar to what they used to be.

The US trans-Pacific does have an overcapacity problem at present so adding Air Asia would only add to that - but that would be true for any new entrant as well.

 

[Dave Noble]

Oh, so very true.

It's easier to complain, rather than think about the cause of things. There's also a lot of selective comparisons that go on, e.g. compare the hot bargain you hear about elsewhere with the day to day price that exists when you want to look at something here, and ignore the more expensive journeys elsewhere that don't fit the preconceived notion.

Comparing like for like ; taking the flights I am taking on sunday with EK vs doing the reverse in the same First (A) class

EU-SYD EUR4292 = $6113
SYD-EU $12633

106% premium for the equivalent journey starting from Australia

Even with an expensive destination
LHR-SYD GBP5228 = $8903
SYD-LHR $12831

so just a 44% premium

These are actual avaiilable fares for exactly the same dates and booking class and not just a theoretical cheapest promo fare

Qantas has a discount 1st fare LON-SYD for GBP4297 ($7322) though is a very restricted fare which allows no changes and non refundable vs $18363 (150% premium) for SYD-LON; even business costs $11538

 

[dajop]

Comparing like for like ; taking the flights I am taking on sunday vs doing the reverse in the same First (A) class

EU-SYD EUR4292 = $6113
SYD-EU $12633

106% premium for the equivalent journey starting from Australia

Yes quite an amazing differential, the F market ex-OZ on QF must be holding up well, although I suspect some get a decent corporate discount on that fare. But really what can anyone do about, other than not book QF or alternatively using nested returns, which the savvy do indeed do? The day a government started to regulate F fares, of all things, would indeed be a sad day.

 

[Dave Noble]

But really what can anyone do about, other than not book QF or alternatively using nested returns, which the savvy do indeed do?

Indeed, I just don't book Qantas and won't whlst there are better products and at a better price; 2nd class product should be a 2nd class price; can't imagine why anyone would pay a $5500 premium to fly QF ex AU

If the government was to regulate that the airline could not charge higher for A-B in than for B-A , it would likely be a benefit to those in Australia since I cannot remember a case when fares have been better value starting in AU vs starting in Euope

 

[Traveller F]

Friends of ours who live in Germany travelled April/May 2010 and paid for following route €5005 (approx A$7000) +taxes
(Ticket valid 1 year, change of flights after ticket issue €130)

Düssledorf London J class (BA)
London Bangkok F class (BA) (stop over)
Bangkok Sydney F class (QF) connecting flight to
Sydney to Melbourne J class(QF) (Stop over)
Melbourne to Perth J class (QF) (stop over)
Perth to Melbourne J class (QF) (stop over)
Melbourne to Singapore F class (QF) A380 service (stop over)
Singapore to London F class (QF) A380 service
London to Düsseldorf J class (BA)

What they make less on the Europe Australia Europe route they balance out on the Australia Europe Australia.

Kind regards, Traveller F