Australia: Fares Go Skyward on Fuller Flights
By Steve Creedy, The Australian | Apr. 27, 2007
Airfares from Australia to the Americas increased 9 per cent last year and domestic fares rose 6 per cent as travellers felt the effects of tighter seat availability.
The increases were revealed in American Express Business Travel Monitor figures released on April 26 and underscore comments by travel agents about the difficulty of finding cheap fares on US routes.
The Australian Government came under fire last year from tourism groups for rejecting an intense lobbying campaign by Singapore Airlines to fly between Australia and the US. The Government denied it was protecting Qantas and said it wanted to give Virgin Blue the chance to start a new Australian long-haul route.
The latest Amex figures indicate the problem with US flights is not limited to Australia, as fares in the Asia-Pacific to and from US destinations rose an average of 10 per cent last year.
"Routes to the Americas saw the biggest airfare growth over the year as a result of tight capacity in some markets and the ongoing travel activity linked to the continued outsourcing of products and services to this region," said Amex Business Travel Advisory Services regional head Craig Pike.
The news for Australian travellers was better on other routes. Amex found travellers making trips from Australia to destinations within the Asia-Pacific reaped the benefit of a 2 per cent fall in fares. Those going to Europe, the Middle East and Africa faced a rise of just 1 per cent.
How much extra travellers were slugged depended on which class they travelled. Those paying full business-class fares bore the brunt of the increases with a hefty 8 per cent rise, followed closely by discount economy passengers, who were hit with a 7 per cent increase.
Full first-class fares jumped by 4 per cent while discount first and business-class fares rose by 6 per cent. Only travellers flying full economy saw fares fall, with a solid drop of 10 per cent.
The 6 per cent domestic fare rise came as airlines filled more seats, a trend that continued this year as passenger loads topped 80 per cent.
The pressure on domestic seats should ease later this year with the arrival of new planes and the entry of a third domestic competitor, Tiger Airways.
The Amex index focuses on base airfares and does not take into account fuel surcharges.