QF gouging on US routes

[rodchucker]

Did anyone see the media today on this in SMH.

Remember QF the Australian airline if your are from anywhere but Australia.

This is the part of the airline they say is unsustainable, so if they cannot make money with these fare structures they don't have a chance do they.

I am getting tired of this story.

[wheels_down]

Didn't 75% of QF's profits come off the pacific route before VAus' entry? I am sure I read it somewhere...

[stewser89]

Is this the article you were referring to?

Australia to USA flights | Qantas | Airlines charge more for Australians (http://www.smh.com.au/travel/travel-news/fare-go-australians-gouged-over-us-flights-20110531-1fe8r.html)

Australians flying Qantas to the US face prices up to 60 per cent more than Americans pay to fly here with the same airline.
Figures show that, despite the strong Australian dollar being worth more than the Greenback, return flights on Qantas's new Dallas route cost hundreds of dollars more for Australians.
Qantas is charging Australians a lead-in economy return fares of $A2004 to fly Sydney-Dallas-Sydney.


Read more: Australia to USA flights | Qantas | Airlines charge more for Australians (http://www.smh.com.au/travel/travel-news/fare-go-australians-gouged-over-us-flights-20110531-1fe8r.html#ixzz1O1qs5gGc)

Yet the airline charges from only $US1578 ($US1438 fare, plus $US140 to $US210 in US government fees) for Americans to go Dallas-Sydney-Dallas on the same planes.
When the exchange rate is taken into account, the difference in pricing is even more stark.
At today's exchange rate, the $US1578 return ticket bought in the US translates to just $A1473, making the price difference a whopping $A531.
The $531 premium Australians pay is 36 per cent more than Qantas charges Americans on the same route.
But the disparity gets worse.
The lead-in US fare is for flights between October 26 and November 16. Australians flying in late October on the same plane could be paying as much as $2404 return, or an additional $931 — 63 per cent more than Qantas charges Americans.
And the disparity isn't confined to Qantas' Dallas route.
Americans flying Qantas economy return Los Angeles-Sydney pay from just $US1318 ($US1178 fare plus additional US government fees of $US140 to $US210) — the equivalent of $A1231.
Fly to Sydney-LA return and the cheapest Qantas flight costs Australians $1854, a difference of $623, or 50 per cent more than the US fare.
Fairfax Media asked Qantas for an explanation.
"We price to match market conditions and demand in a particular country. In the United States, Australia and Qantas are competing for potential visitors with many other destinations and airlines, so we need to offer sufficiently attractive fares to generate demand," Qantas spokesman Thomas Woodward said.
"In Australia, the United States is currently a popular destination, with high demand for travel there being driven by the strong Australian dollar, so the lead-in fares are higher to reflect that demand," he said.
So there it is: Qantas charges Australians 50 per cent more to travel than Americans flying in the opposite direction, because it can.
"Regardless of the differences between the markets, we believe our lead-in fares for travel to the US from Australia and from the US to Australia are good value," Mr Woodward said.
But Qantas is not alone in the practice.
Virgin Australia has a lead-in economy Sydney-LA-Sydney special for $1689.
Book from the US end and fly in the opposite direction and it costs Americans from $US1258 ($US1158, plus US government fees of $100 to $250), the equivalent of $A1175.
That's a difference of $514, or a 44 per cent hike for Australians over the US fare.


Read more: Australia to USA flights | Qantas | Airlines charge more for Australians (http://www.smh.com.au/travel/travel-news/fare-go-australians-gouged-over-us-flights-20110531-1fe8r.html#ixzz1O1qs5gGc)

[Jack Ranga]

Well, we do now have a choice.............

The only way to get rid of the un-Australian maggot running this airline is to make it clear to the board.

[aussie027]

This F!@#$% ticket pricing rort has been going on for decades.:mad::mad::mad:

I used to fly from US to Aust and return often and the pricing disparity was often at least 200 USD on the ticketprice alone omitting the huge diff in govt fees depending which end you start the trip in. When that is added in its even worse.

Sometimes though in past 15yrs after converting the dollars it was often cheaper to fly from Aust to the US and back instead of the other way around.

Problem is the airlines wouldnt let you buy a ticket at the other end to use. That is ,have a friend book /pay for the trip at the US end, mail you the "ticket" so you could fly SY-LAX-SY for eg.
Don't know if that is still the case but that is what I was repeatedly told.:ugh::ugh::ugh:

[Metro man]

Same thing goes on domestically in the USA, a return ticket from Miami to Kansas City is more expensive than a return ticket from Kansas City to Miami.

Reason being, someone in Kansas wanting to travel to Miami is going on holiday and has plenty of other places he can go if he doesn't like the price. Someone in Miami going to Kansas City is going there for a reason (family/business) and can't simply go somewhere else, therefore he pays more.:hmm:

[FlareArmed]

Like any business, QF charge what they can get away with in each location; they aren't a co-op for the good of the people.

The supermarkets charge more in the rich end of town because they can; landlords charge as much rent as they can without the tenants squealing too much or walking; it's cheaper for a Kiwi to book a flight from Australia to New Zealand using the Australian website; it's not price gouging – it's just market forces, IMHO.

[ampclamp]

QF charge what the market will take. That is business. If customers dont like it fly with someone else. If people don't fly they must drop fares.

[airtags]

We're in biz to make money (sorry shareholders and staff the money is for Exec bonuses mainly) - that said it seems that there are not a lot of seats without bums on them so the price is either appropriately market geared or there's not enough capacity.

- will be interesting though to see what JQ charges when SFO & LAX start seeing orange stars in the not too distant future. (:E Question to the JQ people ....... ..how did the meetings go in the US last week???)

AT

[aulglarse]

wheels, close man but it was 20% for the Pacific run and international contributed 75% to the whole profit only a decade ago.:rolleyes:

[FOCX]

The disparity between airfares between Australia and OS has been going on for sometime. I checked out airfares between here and the US over 10 yrs ago for my sister (LAX-SYD) and it was 30-40%. This was before you could book oneway tickets at the same rate as a return ticket. I guess if you have rellies OS you could get them to book and pay with a OS credit card for two separate journeys!

After joining CX I found the same between HK and OZ. My guess is that the home airline gets to charge more out of its base than its OS competitors as I gather they have a greater presence and therefor a competitive edge on getting away with higher priced tickets.

[bankrunner]

On SYD-LAX United have a superior business class product for a lot less money.

If AJ really wants to insist that I fly UA instead of QF, well, good on him.

[standard unit]

On SYD-LAX United have a superior business class product

How so?

Details much appreciated.

[bankrunner]

* The food's nicer

* Seats are better (compared with QF's 744 J/C seats)- they lie flat, and have more padding than QF's

* IFE is better; 15 inch, higher resolution displays, you can use your own standard headphones without the silly adaptor, more content than the QF 744, seems to crash less than the QF 744 IFE, and they've got live cockpit VHF COM audio :ok:

* UA use NZ's lounge in Sydney, which has a better fitout, food selection and drink availablity than the QF business lounge, which QF have been cutting back progressively over the years.

* Domestic connections from LAX leave from the terminal immediately next door to where you arrived. As opposed to with QF, where you arrive at the war zone generally known as TBIT, wander outside and then find your way to whichever distant terminal you need to be at for your connection.

* Cabin crew are generally very good on both sides, you always have the occasional exception though.

Though I suppose, what would AJ know about having a premium product? The likes of the Orange Cancer are more his thing :E

[stewser89]

Sorry but wasn't the skybed a game changer when they relased it because it was the first fully reclining seat or something like that.

Doesn't it lie fully flat?

[bankrunner]

Only the A380 version. The B744 version isn't quite flat, this is supposed to change at some point though.

[stewser89]

Sure

Wouldn't you actually have to invest money for that to happen:ugh:
Wait maybe if they cut some of out it it will lie flat. :ok:

[maggot738]

This is a route I use regularly and it has been cheaper for me to have a one way ticket to London then book return London Adelaide flights from the U/K end. Believe it or not this saves me over $500 per trip several times per year. Very un Australian by QF.

Maggot

[Eastwest Loco]

I have a lot of J Class passengers on the SYD LAX run and unfortunately QF is losing to the others on a price basis.

I just ran a comparison with QF and some others for an October departure and the results are as follows for an October departure.

Fares include taxes but not Agent fees.

Qantas $9045.24
United $6698.24
Delta $6689.24
Air Pacific $6626.24

I can't he;p but think that the Rat is overpricing a product that is indeed excellent but my passenger reports indicate that the Delta product is excellent and that United is a surprise too.

Air Pacific suffers from being via NAN and not the same quality in seating.

That patch of water is still overpriced on a mileage basis, but I guess if the Airlines are forced to deop fares there then the missing dollars will be loaded onto other routes.

Such is our world.

Best all

EWL

[bankrunner]

While I'd like to support the Rat, it's not my money. I get J class flights overseas as part of my employment conditions but when my boss asks "why did you fly QF for $9000 when United was $6700", what do I tell him? He's not going to see much business value in that $2300.

[yellowmellow]

On the ground the Qantas lounge is a much better offering than Air NZ's, starting with the barista! The Qantas lounge has improved heaps over the past couple of years.

In the air the yanks can have their bad days just as much as QF - food and wine on Qantas is the better too. If you fly on the A380 - there's no competition when it comes to seat and IFE.

Pacific doesn't even come close to QF.

That all said.... is it worth the extra 2-3000 dollars for QF??
ANSWER....????

[Metro man]

Average flight time both ways would be around 28 hours, with a $2300 fare difference, you would "earn" around $80/hour(annual equivalent $166 000) by flying on the cheaper airline. Not too bad just for sitting in a chair doing nothing.

[Howard Hughes]

That all said.... is it worth the extra 2-3000 dollars for QF??
ANSWER....????
In my opinion business/first class are the most overpriced services you can buy. Let's face it for the extra you get a lay flat seat and a decent meal. A room in a decent hotel costs about $350 night and a decent meal with wine would not be more than $200, yet we pay a $4000+ premium to fly in business and an even more ridiculous price for first.

But if people are willing to pay then why not charge whatever you can? After all business is about making money!:ok:

[breakfastburrito]

Howard, there is an explanation that satisfies your quandary, which like you I could never understand until I did some research.

In our financial system (fiat) there are a number of businesses which are incredibly profitable. Think of the concept of a "money nozzle", where money is literally created out of thin air, at no cost. As there is no tangible backing to modern currencies, unlimited quantities of money & credit can be created. (BTW this is the source of inflation, as more dollars are continuously being created chasing the same number of goods, hence driving up the nominal price).

This can be done by two entities - the government & the financial system (banks, shadow banking system & financial services) . The government uses this newly created money to fund its day to day operations. The banks lend it & charge interest on this newly created money (the principle + interest is repaid). The banks are incredibly profitable because they get the some capture most of the interest for "free". It is the interest component that makes banking so profitable.

The closer you are to the "money nozzle", the more profitable your business is. What all airlines with First/Business are capturing some of this freshly create money. Think why QF has so many business class seats into CBR - they are capturing some of this newly created money being spent by the government (Bureaucracy,defence & politicians). This is why routes linking financial & government centers have profitable business/first cabins, yet ports like Cairns & Coolangatta do not.

It is the same with government contractors (defense is a classic example). These profitable entities earn so much money that the cost of a business first seat is not a consideration - quite simply they can afford to pay up, as the "free money" just keeps rolling in from the government.

In short, for the average "punter" business is probably doesn't represent good value, but to governments & businesses & that are close to the money nozzle who cares. Airlines are just attempting to capture some of this "free money".

If you have being paying attention, who is actually paying for this "free" money that someone else gets to spend - you guessed it YOU, through higher inflation. Inflation is simply a stealth tax on everyone in society through the continuous debasement of purchasing power. It affect the prudent & saver the most, and rewards the reckless (those that borrow to repay in debased currency).

Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.John Maynard Keynes

See the book: Dying of Money -Lessons of the great German & American Inflations (1974) by Jens O Parsson (.epub format) (http://www.mediafire.com/download.php?6ofsn9jdi9ferzm) (alternative .pdf format (http://www.mediafire.com/download.php?f59hm0nmkun14k6))