Wirraway
26th Feb 2004, 21:49
Fri "The Australian"
Editorial: Airline duopoly is taking flight
February 27, 2004
JUST 18 months ago, exactly one year after the collapse of Ansett, an editorial in The Australian grumbled about the difficulty of finding discount airfares, and noted that "rightly or not, many passengers feel Qantas has become more smug with Ansett out of the way".
But with Qantas's new low-cost offshoot Jetstar, and competitor Virgin Blue, offering 300,000 fares for $29 this week, air travellers are not doing any heavy-duty grumbling, and Qantas is looking anything but smug.
These fares are virtually the heaviest discounting ever seen in Australia. And while commercial sanity will prevail and discount fares will start to rise again, 30 months out from the Ansett collapse one would have to say the industry is looking viable and competitive. In 2001 The Australian supported the decision by the Howard Government not to throw taxpayers' dollars at a bail-out of Ansett, believing that running an airline is best left to the private sector. And despite Lindsay Fox and Solomon Lew appealing to national sentiment, Ansett II was never going to fly long as an extension of ACTU power.
And after an initial period of soaring fares, during which Qantas briefly enjoyed 90 per cent of the market, normal market economics kicked in, and Virgin Blue reasserted itself. It now enjoys a 30 per cent market share. But this has not knocked the flying kangaroo out of the air, with Qantas announcing a record first-half profit last week. While it should never be forgotten that the collapse of Ansett carried a great human cost - for commuters holding tickets, for frequent flyers holding points, and above all for Ansett's staff, who still have not received the full entitlements due to them - at this stage it has left us with an airline structure well adapted to the times. The fact that our two major listed airlines are both producing strong earnings is a sign that the industry has rebounded from the one-two punch of terrorism and SARS. And while Virgin's northern headquarters have dealt Brisbane into the industry action, Jetstar will partly fill the corporate hole that the demise of Ansett left in the heart of Melbourne.
The launch of Jetstar has meant an immediate boost in the availability and affordability of seats. But even more important are the emerging signs of flexibility and innovation in the industry, signs that are the furthest cry from the two-airline policy that stagnated growth for decades. Jetstar is planning to operate almost a third of its Victorian flights out of Avalon airport, near Geelong, as a way around the punitive costs levied by the big airports. And in the aftermath of Ansett, the unions appear to have been mugged by reality, and are ready to accept flexible working practices in an effort to lower costs - particularly remarkable in Victoria, the spiritual homeland of intransigent unionism. These deeper portents, together with yesterday's frenzied take-up of the new fares, suggest that the good times could last in Australia's skies.
=========================================
Fri "The Australian"
Travellers crash air war price websites
By Steve Creedy and Kevin Meade
February 27, 2004
TRAVELLERS flooded the websites of Qantas offshoot Jetstar and Virgin Blue yesterday in a bid to get the first 300,000 $29 one-way internet fares on offer in the budget air price war.
The airlines' websites were unable to cope with the extraordinary demand and only a little more than half the cheap fares offered were snapped up.
Virgin Blue said traffic was running at five times normal levels as it sold more than 100,000 tickets since its sale opened on Wednesday.
Jetstar was flooded by 3.5million visits to its website in the 10 hours after the special fares went on sale at 6am yesterday. It also opened its call centres two hours earlier than scheduled. But it struggled to cope with demand that averaged 200 bookings per minute and 600,000 hits an hour.
By 4pm it had sold 60,000 of the 100,000 $29 tickets and said the cheap fares were already exhausted on some routes.
"This level of activity is unprecedented and I regret the inconvenience caused," Jetstar chief executive Alan Joyce said.
Mr Joyce said travellers had already begun migrating to the airline's everyday fares on routes where the sale tickets had sold out. The most popular flights for consumers were Brisbane-Avalon, outside Melbourne, Sydney-Avalon, Sydney-Hamilton Island and Brisbane-Hamilton Island.
Virgin spokeswoman Amanda Bolger said the airline expected to sell 120,000 tickets by today.
While the airlines struggled to deal with the rush, travel agents were also inundated.
A rush on Flight Centre stores by people seeking cheap airfares caused breakdowns in the airlines' computer booking systems and many potential customers missed out on tickets.
A Flight Centre sales consultant in Brisbane, who declined to be named, said many customers were angered by the collapse in the booking system.
"They all came flooding in this morning - and got ****ty and left," she said.
Flight Centre managing director Graham Turner said the agency's stores throughout the country were inundated with inquiries from customers chasing cheap flights.
Mr Turner said the breakdowns were causing great frustration for Flight Centre's customers and consultants.
The drama was sparked by Jetstar's launch on Wednesday when it announced it would sell 100,000 introductory $29 one-way internet fares to launch its new network on May 25.
Virgin quickly hit back by matching the offer and doubling the number of tickets.
The new airline will operate up to 88 flights a day from Brisbane, Melbourne and Sydney to 10 east coast leisure destinations.
===========================================
Editorial: Airline duopoly is taking flight
February 27, 2004
JUST 18 months ago, exactly one year after the collapse of Ansett, an editorial in The Australian grumbled about the difficulty of finding discount airfares, and noted that "rightly or not, many passengers feel Qantas has become more smug with Ansett out of the way".
But with Qantas's new low-cost offshoot Jetstar, and competitor Virgin Blue, offering 300,000 fares for $29 this week, air travellers are not doing any heavy-duty grumbling, and Qantas is looking anything but smug.
These fares are virtually the heaviest discounting ever seen in Australia. And while commercial sanity will prevail and discount fares will start to rise again, 30 months out from the Ansett collapse one would have to say the industry is looking viable and competitive. In 2001 The Australian supported the decision by the Howard Government not to throw taxpayers' dollars at a bail-out of Ansett, believing that running an airline is best left to the private sector. And despite Lindsay Fox and Solomon Lew appealing to national sentiment, Ansett II was never going to fly long as an extension of ACTU power.
And after an initial period of soaring fares, during which Qantas briefly enjoyed 90 per cent of the market, normal market economics kicked in, and Virgin Blue reasserted itself. It now enjoys a 30 per cent market share. But this has not knocked the flying kangaroo out of the air, with Qantas announcing a record first-half profit last week. While it should never be forgotten that the collapse of Ansett carried a great human cost - for commuters holding tickets, for frequent flyers holding points, and above all for Ansett's staff, who still have not received the full entitlements due to them - at this stage it has left us with an airline structure well adapted to the times. The fact that our two major listed airlines are both producing strong earnings is a sign that the industry has rebounded from the one-two punch of terrorism and SARS. And while Virgin's northern headquarters have dealt Brisbane into the industry action, Jetstar will partly fill the corporate hole that the demise of Ansett left in the heart of Melbourne.
The launch of Jetstar has meant an immediate boost in the availability and affordability of seats. But even more important are the emerging signs of flexibility and innovation in the industry, signs that are the furthest cry from the two-airline policy that stagnated growth for decades. Jetstar is planning to operate almost a third of its Victorian flights out of Avalon airport, near Geelong, as a way around the punitive costs levied by the big airports. And in the aftermath of Ansett, the unions appear to have been mugged by reality, and are ready to accept flexible working practices in an effort to lower costs - particularly remarkable in Victoria, the spiritual homeland of intransigent unionism. These deeper portents, together with yesterday's frenzied take-up of the new fares, suggest that the good times could last in Australia's skies.
=========================================
Fri "The Australian"
Travellers crash air war price websites
By Steve Creedy and Kevin Meade
February 27, 2004
TRAVELLERS flooded the websites of Qantas offshoot Jetstar and Virgin Blue yesterday in a bid to get the first 300,000 $29 one-way internet fares on offer in the budget air price war.
The airlines' websites were unable to cope with the extraordinary demand and only a little more than half the cheap fares offered were snapped up.
Virgin Blue said traffic was running at five times normal levels as it sold more than 100,000 tickets since its sale opened on Wednesday.
Jetstar was flooded by 3.5million visits to its website in the 10 hours after the special fares went on sale at 6am yesterday. It also opened its call centres two hours earlier than scheduled. But it struggled to cope with demand that averaged 200 bookings per minute and 600,000 hits an hour.
By 4pm it had sold 60,000 of the 100,000 $29 tickets and said the cheap fares were already exhausted on some routes.
"This level of activity is unprecedented and I regret the inconvenience caused," Jetstar chief executive Alan Joyce said.
Mr Joyce said travellers had already begun migrating to the airline's everyday fares on routes where the sale tickets had sold out. The most popular flights for consumers were Brisbane-Avalon, outside Melbourne, Sydney-Avalon, Sydney-Hamilton Island and Brisbane-Hamilton Island.
Virgin spokeswoman Amanda Bolger said the airline expected to sell 120,000 tickets by today.
While the airlines struggled to deal with the rush, travel agents were also inundated.
A rush on Flight Centre stores by people seeking cheap airfares caused breakdowns in the airlines' computer booking systems and many potential customers missed out on tickets.
A Flight Centre sales consultant in Brisbane, who declined to be named, said many customers were angered by the collapse in the booking system.
"They all came flooding in this morning - and got ****ty and left," she said.
Flight Centre managing director Graham Turner said the agency's stores throughout the country were inundated with inquiries from customers chasing cheap flights.
Mr Turner said the breakdowns were causing great frustration for Flight Centre's customers and consultants.
The drama was sparked by Jetstar's launch on Wednesday when it announced it would sell 100,000 introductory $29 one-way internet fares to launch its new network on May 25.
Virgin quickly hit back by matching the offer and doubling the number of tickets.
The new airline will operate up to 88 flights a day from Brisbane, Melbourne and Sydney to 10 east coast leisure destinations.
===========================================