SIA misses out on SY-LA
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I'm sure that if I pick up Idiot's Guide to Economics I reckon I could spurt out some of the economic theories posted previously in no time. However, I am yet to see the concrete evidence that allowing SQ onto the route is good for Aus. Once again - how many jobs created? What increase to GDP? Show me the figures and back it up with evidence. The federal government obviously wasn't convinced. No I know some of you will say because they own QANTAS shares or are part of the "Sydney set" but that is just emotive rubbish! The government is elected by the people. It does want it thinks will get it re-elected. It obviously thinks that the Australian people don't want SQ on the route. If you want to convince the Australian people otherwise, show us the facts. I do not think
wins the argument!!!!!!
Please give up. The research has been done.
The jobs growth will NOT be at Qantas. The growth will be across the entire economy. It comes about from increases in local demand caused by increased travel caused by reduced ticket prices and increased capacity. That generates increased economic activity which increase the number of jobs.
You guys are using exactly the same "The sky is falling" argument the car industry used in the 80's when the government started removing protection from said industry. Probably none of you remember buying an Australian car from the days when the manufacturers were "protected" - badly made, poor quality copies of outdated copies of american stuff, sold at twice the price of the equivalent american or european car. I grew up in the era where industry was "protected", and what a miserable array of goods and services those "protected" industries produced.
The only industry "protection" that really works is to produce a world class product at a world class price - as the car industry now does. You are kidding yourselves if you think you have any long term job security without doing exactly the same, and please stop coming up with these "level playing field" arguments.
The rest of the Australian economy has to compete without protection, and so should you, because otherwise our transaction costs are higher than our competitors, and we lose business as a result.
I'll bet you guys probably can't even remember the days of the "Two airline " domestic policy. Domestic ticket prices were set over a few beers at Mac's. God those were wonderful days
You guys are using exactly the same "The sky is falling" argument the car industry used in the 80's when the government started removing protection from said industry. Probably none of you remember buying an Australian car from the days when the manufacturers were "protected" - badly made, poor quality copies of outdated copies of american stuff, sold at twice the price of the equivalent american or european car. I grew up in the era where industry was "protected", and what a miserable array of goods and services those "protected" industries produced.
The only industry "protection" that really works is to produce a world class product at a world class price - as the car industry now does. You are kidding yourselves if you think you have any long term job security without doing exactly the same, and please stop coming up with these "level playing field" arguments.
The rest of the Australian economy has to compete without protection, and so should you, because otherwise our transaction costs are higher than our competitors, and we lose business as a result.
I'll bet you guys probably can't even remember the days of the "Two airline " domestic policy. Domestic ticket prices were set over a few beers at Mac's. God those were wonderful days
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Still reading a lot of economic theory but still no figures to back it up. I await any figures such as expected job growth an expected increased in GDP with bated breath....
Those who argue that allowing SQ on the route will create jobs and boost the economy must be arguing that it will encourage American tourists to come Dunnunda. Now I have been to the US many times, and when Americans hear that I am from Australia, they almost invariably comment on how great they think Oz is and how they would love to travel there. When I ask why they don't travel there, most of them mention the distance and that they simply don't have the time. NOT ONCE have I ever heard anyone say that the airfare is too high. Can SIA tell us how much they would charge for a return economy ticket LAX-SYD? How many more American tourists would come if the ticket were $100 cheaper. Now that would be an interesting survey.
And answer me one last thing - why is SQ the only saviour of the transpacific route. Wouldn't having J* or DJ (or some offshoot thereof) on the route be better for the Australian economy?
Those who argue that allowing SQ on the route will create jobs and boost the economy must be arguing that it will encourage American tourists to come Dunnunda. Now I have been to the US many times, and when Americans hear that I am from Australia, they almost invariably comment on how great they think Oz is and how they would love to travel there. When I ask why they don't travel there, most of them mention the distance and that they simply don't have the time. NOT ONCE have I ever heard anyone say that the airfare is too high. Can SIA tell us how much they would charge for a return economy ticket LAX-SYD? How many more American tourists would come if the ticket were $100 cheaper. Now that would be an interesting survey.
And answer me one last thing - why is SQ the only saviour of the transpacific route. Wouldn't having J* or DJ (or some offshoot thereof) on the route be better for the Australian economy?
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The jobs created by SIA would be a direct result of globalisation. More people employed equals a stronger Australian economy. We cannot afford to have "protectionalism" in this world economy otherwise we will lose our competitiveness.
Evertonian
I guess economic growth is good...especially when you aren't on the dole.
I wonder how the Nissan factory workers are faring these days...How are the Mitsubishi guys feeling about the economy?
It can't always be a Win-Win scenario...someone ultimately pays.
I wonder how the Nissan factory workers are faring these days...How are the Mitsubishi guys feeling about the economy?
It can't always be a Win-Win scenario...someone ultimately pays.
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This is the Australian forum for Professional pilots. Tell me Sunfish, how would letting SIA operate SYD-LA benefit Australian pilots? Oh that's right, you don't make you living as one do you? Neither incidentally does P-A-F, being a General Duties officer. Definition, an officer whos duties sometimes include flying aeroplanes.
Why do you guys hang around here if you don't fit in? You are not going to get any sympathy and you know this. Do you like picking fights with pilots who have more to be concerned about than trading esoteric economic points with amateurs?
Why do you guys hang around here if you don't fit in? You are not going to get any sympathy and you know this. Do you like picking fights with pilots who have more to be concerned about than trading esoteric economic points with amateurs?
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"Globalisation", "competitiveness", protectionism" - all words I could pick up too if I read Idiot's Guide to Economics. Seen a lot of buzz words but no substance to support the argument for SIA.
To all of you who quote economic textbooks for your arguments, let me ask you this - is economics a science? To be a science, your hypotheses or theories need to accurately predict an outcome based on a set of circumstances. My experience of economics (very limited as it might be) is that it may be very good at explaining why something happened, but it certainly cannot accurately predict future occurences. Truth is, no one can give an accurate prediction of jobs created or effect on GDP from allowing SIA to do SYD-LAX because you do not know! I'm sure the economists on this website in ten years time will be able to give us an outstanding account of why the predicted jobs growth or economic growth from allowing SIA to fly the route did not eventuate.
Show me proof that opening up the route to SIA will benefit Oz and I might listen. Don't give me buzz words. Put up or shut up!
To all of you who quote economic textbooks for your arguments, let me ask you this - is economics a science? To be a science, your hypotheses or theories need to accurately predict an outcome based on a set of circumstances. My experience of economics (very limited as it might be) is that it may be very good at explaining why something happened, but it certainly cannot accurately predict future occurences. Truth is, no one can give an accurate prediction of jobs created or effect on GDP from allowing SIA to do SYD-LAX because you do not know! I'm sure the economists on this website in ten years time will be able to give us an outstanding account of why the predicted jobs growth or economic growth from allowing SIA to fly the route did not eventuate.
Show me proof that opening up the route to SIA will benefit Oz and I might listen. Don't give me buzz words. Put up or shut up!
Almost traitorous sentiments, in my opinion, giving up air rights unneccessarily to the Singaporians ( or the Arabs for that matter ).
Before government starts shipping jobs off shore with policies as such, it needs to look at the uncompetitiveness of the taxation system in Australia. Why should Australian labour & business, be forced to compete at a whim with foreign entities who possess home grown government protectionism ( labour policies, law & taxation ) when the root of the problem is the worlds worst taxation practices.
So, before SQ given a gift horse of trans-pacific flying 1) significant taxation reform needs to have taken place in Oz 2) there is committment from Singaporians in the employment, in numbers, of Australian based airline personnel - labour offsets! 3) Singaporians are forced to invest in local infrastrucutre and not do as they do now, cleverly bring their needs back to their local economy. 4) Singaporian conduct in this country is revealed to the public for media debate.
Until 1-5 addressed, it would be un-Australian to give up another resource to off shore interests.
Before government starts shipping jobs off shore with policies as such, it needs to look at the uncompetitiveness of the taxation system in Australia. Why should Australian labour & business, be forced to compete at a whim with foreign entities who possess home grown government protectionism ( labour policies, law & taxation ) when the root of the problem is the worlds worst taxation practices.
So, before SQ given a gift horse of trans-pacific flying 1) significant taxation reform needs to have taken place in Oz 2) there is committment from Singaporians in the employment, in numbers, of Australian based airline personnel - labour offsets! 3) Singaporians are forced to invest in local infrastrucutre and not do as they do now, cleverly bring their needs back to their local economy. 4) Singaporian conduct in this country is revealed to the public for media debate.
Until 1-5 addressed, it would be un-Australian to give up another resource to off shore interests.
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General Duties officer
You certainly have your feathers ruffled if you are left saying that "Aussie Military pilots aren't real Aussie Pilots". A rather unkind stab at a group of over 600 - 700 pilots in Australia, simply because I have right wing economic views.
All I've ever said is that people should consider their own situation when signing on for pay and conditions. None of this union stuff. I still fail to see why you get so offended at this. After all, the people advocating union and enterprise bargaining aren't advocating it becuase of some higher calling. They are doing it because they think it will gain them a better outcome. Well I don't agree with that way of getting a better outcome.. Now, back to the thread..
I believe the only thing I've stated in here is that structural unemployment can be addressed and economists are aware of the matter. If you must know, I think the fact that Singapore Airlines gets huge benefits being government owned is a limiting factor in allowing them to "compete" against QANTAS. I think that since Singapore won't change how it financially assists SIA the only unfortunately option left is allow them on the route with a suitable tax / tariff on every seat they sell that essentially pegs them back to level playing.
Originally Posted by Pass-A-Frozo
Singapore Airlines gets huge benefits being government owned is a limiting factor in allowing them to "compete" against QANTAS. I think that since Singapore won't change how it financially assists SIA the only unfortunately option left is allow them on the route with a suitable tax / tariff on every seat they sell that essentially pegs them back to level playing.
No way. If Australian & American airlines can't compete with QF, and begrudingly SQ needed for competition, their hand needs to be forced into employing a suitable number of Australian airline personnel.
Ain't nothing wrong with a Singapore girl named Cheryl!
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The beauty of competition is that people can vote with their feet. So if the "Protect Qantas" brigade are right...and they could be, what a great show of affection for this Australian icon if the passengers simply didn't fly with SIA and put the money in QF's pockets instead. Wouldn't the customers listen to the same "Australia First" arguments posted here? And if they wouldn't, being dollar hungry or wanting better service....on what basis do our leaders say 'you can't have that choice" when in almost every other area of life they have choices bewtween imports and home grown products.
In any case, assuming Qantas is serving the route(s) properly there's no need for another single seat so SIA would be whistling in the wind. And QF are lean and mean aren't they? What's to fear?
Protection, under the mask of patriotism is a mean cruel and nasty job destroying tool of populist and weak leaders. We are an exporting nation and our best undustry groups do it well. Sooner or later Qantas will be ready to compete the way Penfolds, Fosters and a thousand other groups do. When they can those shares could really be worth someting. Til then...would I invest in a sheltered workshop that effectively taxes every travelling Australian? I don't think so.
In any case, assuming Qantas is serving the route(s) properly there's no need for another single seat so SIA would be whistling in the wind. And QF are lean and mean aren't they? What's to fear?
Protection, under the mask of patriotism is a mean cruel and nasty job destroying tool of populist and weak leaders. We are an exporting nation and our best undustry groups do it well. Sooner or later Qantas will be ready to compete the way Penfolds, Fosters and a thousand other groups do. When they can those shares could really be worth someting. Til then...would I invest in a sheltered workshop that effectively taxes every travelling Australian? I don't think so.
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Originally Posted by Scumfish
The jobs created by SIA would be a direct result of globalisation. More people employed equals a stronger Australian economy. We cannot afford to have "protectionalism" in this world economy otherwise we will lose our competitiveness.
Reasonably paid skilled jobs are lost to low paid unskilled jobs? Is that a good thing??? Yet more "dumbing" of our once strong skilled workforce.
Whom is this good for? Certainly NOT for those who are filling these jobs. Yes, the good of all this may be increased employment, but at LOWER wages. Who benifits.........?
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An economics forcasting company econtech did a report on it. Although I gather you'd have to pay them to see it 
Bit of a longish read but ..
Here is a synopsis of the argument put forward:
http://www.smh.com.au/news/Business/...123898035.html
The lack of competition on the Qantas-dominated Australia-US route is costing Australia up to $126 million in lost tourist revenue a year, a study commissioned by Singapore Airlines found.
With Federal Cabinet expected to decide next Tuesday on whether to grant Singapore Airlines access to the highly profitable route, economic forecaster Econtech has backed the Asian carrier's claims its entry on the Los Angeles route would substantially boost the number of passengers travelling on the route and help tourism.
"More competition on the Australia-US route would lead to a reduction in air fares on the route and greater flexibility in flight schedules and choice in airlines for prospective passengers," the report said.
Qantas controls two-thirds of the capacity on direct flights to the United States, and United Airways the rest.
The report said the entry of a third airline would boost passenger traffic by between 4 per cent and 8 per cent.
It said greater competition and lower air fares from a third entrant would lead to an extra 48,000 American visitors and between 7000 and 13,000 more Australians travelling to the US each year. This bolstered Singapore Airline's argument that its entry would stimulate new traffic rather than steal passengers from Qantas.
The publication of Bureau of Transport and Regional Economics's figures last week showed the Sydney-to-Los Angeles route had the lowest rate of passenger growth of the 10 busiest air routes into Australia in 2004. Passenger traffic on the route grew 1.6 per cent for the year compared with an average of 17.8 per cent for the other routes.
Highlighting the "clear lack of effective competition" on direct flights to the US, the report said "fares per kilometre on the Sydney-LA return route are, on average, significantly higher than on the Sydney-London return route, despite the costs of the stopover on the Sydney-London route".
The flight distance from Sydney to Los Angeles is about 12,000 kilometres compared with about 20,000 kilometres from Sydney to London. The study found economy fares per kilometre on the Los Angeles route were 17 per cent more expensive than for flights to London. The report said the fare per kilometre to Los Angeles was 8.9c compared with 7.6c for London.
Singapore Airlines said it would make a heavy dent on business fares if it entered the Los Angeles route.
The cheapest business class return ticket to Los Angeles on the Qantas website last night for travel on August 1 was $12,005 not including taxes. This compares with $9385 for a London business flight.
Qantas's chief financial officer, Peter Gregg, questioned the merits of the report commissioned by Singapore Airlines.
"The report was obviously written by someone who knows nothing about the aviation industry," he said.
Mr Gregg said when the report measured "the aircraft-per-kilometre [cost], they didn't take into consideration" the extra operational costs of deploying aircraft on the Los Angeles route. This was, in part, because of the payload restrictions and headwinds encountered on the route.
Mr Gregg said Qantas had "spent billions of dollars developing the route", noting the expense of buying longer-range Boeing 747-400ER aircraft.
Mr Gregg said the report failed to take into consideration the large numbers of passengers who flew between the US and Australia each year through stopovers such as Auckland and Tokyo.
ENTRY EXAMINATION Econtech sees:
- Two-way passenger traffic rising between 4pc and 8pc
- Tourists bringing extra $126m a year into Australia
- 13,000 more Australians heading for US each year
- Air fares down
- Flight schedules more flexible
Bit of a longish read but ..
Here is a synopsis of the argument put forward:
http://www.smh.com.au/news/Business/...123898035.html
The lack of competition on the Qantas-dominated Australia-US route is costing Australia up to $126 million in lost tourist revenue a year, a study commissioned by Singapore Airlines found.
With Federal Cabinet expected to decide next Tuesday on whether to grant Singapore Airlines access to the highly profitable route, economic forecaster Econtech has backed the Asian carrier's claims its entry on the Los Angeles route would substantially boost the number of passengers travelling on the route and help tourism.
"More competition on the Australia-US route would lead to a reduction in air fares on the route and greater flexibility in flight schedules and choice in airlines for prospective passengers," the report said.
Qantas controls two-thirds of the capacity on direct flights to the United States, and United Airways the rest.
The report said the entry of a third airline would boost passenger traffic by between 4 per cent and 8 per cent.
It said greater competition and lower air fares from a third entrant would lead to an extra 48,000 American visitors and between 7000 and 13,000 more Australians travelling to the US each year. This bolstered Singapore Airline's argument that its entry would stimulate new traffic rather than steal passengers from Qantas.
The publication of Bureau of Transport and Regional Economics's figures last week showed the Sydney-to-Los Angeles route had the lowest rate of passenger growth of the 10 busiest air routes into Australia in 2004. Passenger traffic on the route grew 1.6 per cent for the year compared with an average of 17.8 per cent for the other routes.
Highlighting the "clear lack of effective competition" on direct flights to the US, the report said "fares per kilometre on the Sydney-LA return route are, on average, significantly higher than on the Sydney-London return route, despite the costs of the stopover on the Sydney-London route".
The flight distance from Sydney to Los Angeles is about 12,000 kilometres compared with about 20,000 kilometres from Sydney to London. The study found economy fares per kilometre on the Los Angeles route were 17 per cent more expensive than for flights to London. The report said the fare per kilometre to Los Angeles was 8.9c compared with 7.6c for London.
Singapore Airlines said it would make a heavy dent on business fares if it entered the Los Angeles route.
The cheapest business class return ticket to Los Angeles on the Qantas website last night for travel on August 1 was $12,005 not including taxes. This compares with $9385 for a London business flight.
Qantas's chief financial officer, Peter Gregg, questioned the merits of the report commissioned by Singapore Airlines.
"The report was obviously written by someone who knows nothing about the aviation industry," he said.
Mr Gregg said when the report measured "the aircraft-per-kilometre [cost], they didn't take into consideration" the extra operational costs of deploying aircraft on the Los Angeles route. This was, in part, because of the payload restrictions and headwinds encountered on the route.
Mr Gregg said Qantas had "spent billions of dollars developing the route", noting the expense of buying longer-range Boeing 747-400ER aircraft.
Mr Gregg said the report failed to take into consideration the large numbers of passengers who flew between the US and Australia each year through stopovers such as Auckland and Tokyo.
ENTRY EXAMINATION Econtech sees:
- Two-way passenger traffic rising between 4pc and 8pc
- Tourists bringing extra $126m a year into Australia
- 13,000 more Australians heading for US each year
- Air fares down
- Flight schedules more flexible
Originally Posted by 019360
. We are an exporting nation and our best undustry groups do it well. Sooner or later Qantas will be ready to compete the way Penfolds, Fosters and a thousand other groups do. .
Perhaps, Qantas long haul staff should become "tax free" and rebates offered to Qantas, from any government wishing to allow foreign carriers willy-nilly access to OUR air routes!
Gentlemen, please stop demonstrating your lack of knowledge of economics. The verdict that free trade was better than protectionism was passed at least twenty years ago. Thets what the world trade organisation talks each year are about - opening up markets.
What do you think you would be paying for telephone calls if Optus and Vodaphone were not at Telstra's throat?
What do you think you would be paying for cars without the flood of cheap imports?
Industry protection is called "rent seeking behaviour" it appears to protect your jobs but it actually protects inefficient managers while penalising the rest of the economy that is internationally competitive.
You want examples - look no further than the car industry, computers and telecommunications.
Furthermore, your international competitors in aviation are doing just that - competing with each other. They get better at what they do day by day through competition. So what does QF do? Well if its not competing, but sitting on its fat @ss, then it isn't improving at the same rate as its competitors is it?
What that means is that it is not "protecting pilots jobs" at all! When the government does finally remove your industry protection, the adjustment is going to be all the more painful because the "gap" between your performance and your competitors is widening all the time.
Please don't shoot the messenger, its just the economic facts of life these days and aviation is no exception. It's nothing personal.
Those of you who wish to argue this point are like the flat earth society. All around the world everyone is trying to open markets and advance the cause of free trade.
What do you think you would be paying for telephone calls if Optus and Vodaphone were not at Telstra's throat?
What do you think you would be paying for cars without the flood of cheap imports?
Industry protection is called "rent seeking behaviour" it appears to protect your jobs but it actually protects inefficient managers while penalising the rest of the economy that is internationally competitive.
You want examples - look no further than the car industry, computers and telecommunications.
Furthermore, your international competitors in aviation are doing just that - competing with each other. They get better at what they do day by day through competition. So what does QF do? Well if its not competing, but sitting on its fat @ss, then it isn't improving at the same rate as its competitors is it?
What that means is that it is not "protecting pilots jobs" at all! When the government does finally remove your industry protection, the adjustment is going to be all the more painful because the "gap" between your performance and your competitors is widening all the time.
Please don't shoot the messenger, its just the economic facts of life these days and aviation is no exception. It's nothing personal.
Those of you who wish to argue this point are like the flat earth society. All around the world everyone is trying to open markets and advance the cause of free trade.
Originally Posted by Pass-A-Frozo
An economics forcasting company econtech did a report on it. Although I gather you'd have to pay them to see it
Bit of a longish read but ..
Here is a synopsis of the argument put forward:
http://www.smh.com.au/news/Business/...123898035.html
The lack of competition on the Qantas-dominated Australia-US route is costing Australia up to $126 million in lost tourist revenue a year, a study commissioned by Singapore Airlines found.
With Federal Cabinet expected to decide next Tuesday on whether to grant Singapore Airlines access to the highly profitable route, economic forecaster Econtech has backed the Asian carrier's claims its entry on the Los Angeles route would substantially boost the number of passengers travelling on the route and help tourism.
"More competition on the Australia-US route would lead to a reduction in air fares on the route and greater flexibility in flight schedules and choice in airlines for prospective passengers," the report said.
Qantas controls two-thirds of the capacity on direct flights to the United States, and United Airways the rest.
The report said the entry of a third airline would boost passenger traffic by between 4 per cent and 8 per cent.
It said greater competition and lower air fares from a third entrant would lead to an extra 48,000 American visitors and between 7000 and 13,000 more Australians travelling to the US each year. This bolstered Singapore Airline's argument that its entry would stimulate new traffic rather than steal passengers from Qantas.
The publication of Bureau of Transport and Regional Economics's figures last week showed the Sydney-to-Los Angeles route had the lowest rate of passenger growth of the 10 busiest air routes into Australia in 2004. Passenger traffic on the route grew 1.6 per cent for the year compared with an average of 17.8 per cent for the other routes.
Highlighting the "clear lack of effective competition" on direct flights to the US, the report said "fares per kilometre on the Sydney-LA return route are, on average, significantly higher than on the Sydney-London return route, despite the costs of the stopover on the Sydney-London route".
The flight distance from Sydney to Los Angeles is about 12,000 kilometres compared with about 20,000 kilometres from Sydney to London. The study found economy fares per kilometre on the Los Angeles route were 17 per cent more expensive than for flights to London. The report said the fare per kilometre to Los Angeles was 8.9c compared with 7.6c for London.
Singapore Airlines said it would make a heavy dent on business fares if it entered the Los Angeles route.
The cheapest business class return ticket to Los Angeles on the Qantas website last night for travel on August 1 was $12,005 not including taxes. This compares with $9385 for a London business flight.
Qantas's chief financial officer, Peter Gregg, questioned the merits of the report commissioned by Singapore Airlines.
"The report was obviously written by someone who knows nothing about the aviation industry," he said.
Mr Gregg said when the report measured "the aircraft-per-kilometre [cost], they didn't take into consideration" the extra operational costs of deploying aircraft on the Los Angeles route. This was, in part, because of the payload restrictions and headwinds encountered on the route.
Mr Gregg said Qantas had "spent billions of dollars developing the route", noting the expense of buying longer-range Boeing 747-400ER aircraft.
Mr Gregg said the report failed to take into consideration the large numbers of passengers who flew between the US and Australia each year through stopovers such as Auckland and Tokyo.
ENTRY EXAMINATION Econtech sees:
- Two-way passenger traffic rising between 4pc and 8pc
- Tourists bringing extra $126m a year into Australia
- 13,000 more Australians heading for US each year
- Air fares down
- Flight schedules more flexible
Bit of a longish read but ..
Here is a synopsis of the argument put forward:
http://www.smh.com.au/news/Business/...123898035.html
The lack of competition on the Qantas-dominated Australia-US route is costing Australia up to $126 million in lost tourist revenue a year, a study commissioned by Singapore Airlines found.
With Federal Cabinet expected to decide next Tuesday on whether to grant Singapore Airlines access to the highly profitable route, economic forecaster Econtech has backed the Asian carrier's claims its entry on the Los Angeles route would substantially boost the number of passengers travelling on the route and help tourism.
"More competition on the Australia-US route would lead to a reduction in air fares on the route and greater flexibility in flight schedules and choice in airlines for prospective passengers," the report said.
Qantas controls two-thirds of the capacity on direct flights to the United States, and United Airways the rest.
The report said the entry of a third airline would boost passenger traffic by between 4 per cent and 8 per cent.
It said greater competition and lower air fares from a third entrant would lead to an extra 48,000 American visitors and between 7000 and 13,000 more Australians travelling to the US each year. This bolstered Singapore Airline's argument that its entry would stimulate new traffic rather than steal passengers from Qantas.
The publication of Bureau of Transport and Regional Economics's figures last week showed the Sydney-to-Los Angeles route had the lowest rate of passenger growth of the 10 busiest air routes into Australia in 2004. Passenger traffic on the route grew 1.6 per cent for the year compared with an average of 17.8 per cent for the other routes.
Highlighting the "clear lack of effective competition" on direct flights to the US, the report said "fares per kilometre on the Sydney-LA return route are, on average, significantly higher than on the Sydney-London return route, despite the costs of the stopover on the Sydney-London route".
The flight distance from Sydney to Los Angeles is about 12,000 kilometres compared with about 20,000 kilometres from Sydney to London. The study found economy fares per kilometre on the Los Angeles route were 17 per cent more expensive than for flights to London. The report said the fare per kilometre to Los Angeles was 8.9c compared with 7.6c for London.
Singapore Airlines said it would make a heavy dent on business fares if it entered the Los Angeles route.
The cheapest business class return ticket to Los Angeles on the Qantas website last night for travel on August 1 was $12,005 not including taxes. This compares with $9385 for a London business flight.
Qantas's chief financial officer, Peter Gregg, questioned the merits of the report commissioned by Singapore Airlines.
"The report was obviously written by someone who knows nothing about the aviation industry," he said.
Mr Gregg said when the report measured "the aircraft-per-kilometre [cost], they didn't take into consideration" the extra operational costs of deploying aircraft on the Los Angeles route. This was, in part, because of the payload restrictions and headwinds encountered on the route.
Mr Gregg said Qantas had "spent billions of dollars developing the route", noting the expense of buying longer-range Boeing 747-400ER aircraft.
Mr Gregg said the report failed to take into consideration the large numbers of passengers who flew between the US and Australia each year through stopovers such as Auckland and Tokyo.
ENTRY EXAMINATION Econtech sees:
- Two-way passenger traffic rising between 4pc and 8pc
- Tourists bringing extra $126m a year into Australia
- 13,000 more Australians heading for US each year
- Air fares down
- Flight schedules more flexible
Virgin will be the competion. Stuff the Singaporians!
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Originally Posted by The_Cutest_of_Borg
...... Tell me Sunfish, how would letting SIA operate SYD-LA benefit Australian pilots?
Well, Cutey, those old buggers with their millions of superannuation at the top of the seniority list (
) can become YSSY based Pacific Barons for SIA. For years SIA was full of 'retired' Qantas drivers, many of whom no doubt had debt remaining after their third or more divorce or large a acreage to pay off. And they'd probably find many young Aussies to act as cruise captains to hold their hands and push their wheelchairs for not much more than the minimum wage.
The publication of Bureau of Transport and Regional Economics's figures last week showed the Sydney-to-Los Angeles route had the lowest rate of passenger growth of the 10 busiest air routes into Australia in 2004. Passenger traffic on the route grew 1.6 per cent for the year compared with an average of 17.8 per cent for the other routes.
Of course the SYD-LAX route is growing slowly, simply because QF is using the capacity to the US out of BNE and MEL. Off the top of my head, BNE-LAX direct is now 5 times weekly soon, and MEL-LAX is daily (and double daily at certain times of the year). The daily AKL-LAX flights now originate in MEL instead of BNE, offering an additional one-stop service from MEL that didn't exist 12 months ago.
In the past a lot of the BNE and MEL traffic would have to transit SYD, now they are flying direct. Of course the growth in SYD-LAX is only 1.6%.
As a QF employee and a proud Australian, I would much prefer seeing DJ have a shot at the Aus-LA route, using 777s/A340s etc. More jobs for my mates, and more jobs for Australians. What's wrong with that?
TL