Because at the end of the day consumers buy based only on price.
You're wrong, very wrong.
People are capable and willing to pay more when they do truly get a superior product. Flying around on clapped out 734's, 767's (hell even the jumbos are passed it) is not very appealing. Most people I talk to myself included have stuck with QANTAS because of the FF program, Qantas club, business class etc. Now we have Virgin offereing FF status match, business class and decent lounges.
Qantas's soloultion to the problem is to reduce CapEx and delay new aircraft
