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Prices fly up as airlines cut services back to Australia



Airlines are about to get more expensive, with airlines cutting their services to Australia to cope with the rising cost of fuel, a specialist has warned.

The number of seats sold on aircraft flying out of the country will fall for the first time in 14 years this summer, according to The Age, about one per cent between October and March.

This will be the first time international summer capacity has fallen since 2005.

And it is because the rising price of oil makes long journeys to Australia less viable, and large airlines are being forced to prune their number of services in Australia.

Emirates has reduced the frequency of its Dubai-Perth service from 11 to seven times a week, and will be abolishing its Dubai-Bangkok-Sydney daily service next week.

Cathay Pacific is abolishing his Cairns-Hong Kong service as other Asian-Australian routes fall by about one per cent over the summer. Virgin will reduce the frequency of her Sydney-Auckland flights from 18 to 15 trips a week from July, and her Sydney-Christchurch service will return to a seasonal summer service.

Seats on flights between Australia and the US fall over the winter, but they will rise again for the summer. With limited supply, “there will certainly be higher prices,” said Airline's Information and Research consultant Tony Webber The Age.

“(The airlines) are more logical now, our very good news for Qantas and Virgin,” he said.

Qantas chief executive Alan Joyce said this month that he was able to grow his share of the market as other carriers took back their ability.

The rising price of jet fuel was a hot topic at the annual meeting of the International Air Transport Association in Sydney last year, where aircraft chiefs said it would inevitably lead to higher aircraft.

American Airlines chief executive Doug Parker said at the meeting, as fuel about 25 percent of airline costs, carriers would be forced to drive up aircraft and reduce their aircraft capacity.

Mr Parker had warned passengers of the fact that the rising price of fuel would be transferred to them.

“Oil is our second biggest cost. So, when it increases, the cost of air travel increases, ”last year.

“I would expect you to see higher fares for consumers over time.”


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