Facts and Figures

Australia's Air Travellers Soar

Increased competition in the Australian air travel market brought about by the introduction of Impulse Airlines and Virgin Blue Airlines as major domestic carriers in the third quarter of 2000 has seen air fares in Australia drop to extremely competitive levels. The introduction of such low fares has threatened incumbent carriers Ansett and Qantas' stranglehold on the domestic market. Currently, a return trip from Brisbane to Sydney can cost as little as $100-110. As petrol prices continue their climb upward and time becomes an even more important asset, never before has flying been such a popular and affordable transport alternative in Australia.

The price war has resulted in a dramatic rise in air travel in Australia. In March 2001, 2,539,504 passengers were recorded travelling on the domestic transport network, a rise of 11.2% from the same period a year earlier. A considerable proportion of this increased use was on major routes (Sydney-Melbourne, Brisbane-Sydney, Brisbane-Melbourne) where the majority of the price wars have been fought. With Virgin set to introduce further routes to consolidate its armoury, further pressure will be placed on the incumbent airlines' grip on market share. However, Impulse Airlines' stay as the fourth major carrier was cut short in early 2001, being bought out by Qantas.

Overall, major changes in the domestic airline market have occurred in the past nine months and more are expected to occur. While increased competition in the market has had contradictory effects on the carriers, consumers are finally enjoying cheaper flights, with air travel now an affordable and feasible alternative to traditional forms of transport.

While the competition for major routes has resulted in more alternatives and cheaper fares for consumers, the weak Australian dollar and high petrol prices have had a negative effect on rural and regional air services, which have been subject to competition but to a lower extent, due to the exit of Flight West. Flight West recently went into liquidation, and while Ansett Airlines has picked up some of its services, certain regions of Queensland are concerned about the removal of selected air services on their economic and social prosperity.