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Discount fares down

written by australianaviation.com.au | June 18, 2010
photo - Seth Jaworski

The Bureau of Transport and Regional Economics (BITRE) has released its domestic air fare index for June, showing that discount airfares remain sharply lower than over the same time last year.

The index in the best discount category for June 2010 stands at 62, down from 80.8 in June 2009, while the restricted economy index fell from 95.8 to 93. Additionally, the full economy index increased by 0.4 points to 91.2, while the business index decreased from 103.7 to 94.5.

The index appears to confirm recent comments from Virgin Blue CEO John Borghetti that fares, especially discount airfares, have remained depressed as capacity in the domestic market has increased. Also playing a large part appears to be ongoing fare wars between Jetstar and Tiger Airways, while the drop in the business fare index may also signal some weakness in the corporate market.

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