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Consumer watchdog eyes Qantas’ cut-throat fares

written by Sandy Milne | May 7, 2020
A Boeing 737-8FE, operated by Virgin Australia (Source: Aviation Australia archives)

ACCC chairman Rod Sims has said that he is watching “extremely closely” to prevent anti-competitive behaviour from Qantas, as administrators work to resuscitate Virgin Australia.

The news comes after Qantas chief executive Alan Joyce hinted at post-virus bargains, designed to stimulate demand in the domestic travel sector.

“On Melbourne-Sydney you could see Jetstar have $39 airfares, you could see $19 airfares and we’ll still cover our cash costs on those flights,” he told investors on Tuesday.

Advertisement
Advertisement

However, rock-bottom deals like these could serve to price Virgin Australia out of the market. The ACCC has indicated in previous weeks that it will take swift action against any attempts to artificially push down prices or swamp airline routes.

According to Sims, cheap airfares alone are not cause for a breach of competitive practice laws. The commissioner said he is monitoring the situation as it unfolds for evidence of predatory pricing.

“It means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth,” said Sims.

“We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor.”

PROMOTED CONTENT

Sims also indicated that the ACCC is still investigating complaints brought by Virgin chief Paul Scurrah in March. At the time, Sims told the ABC that Scurrah believed that Qantas was “engaging in anti-competitive conduct, designed to damage Virgin as a competitor”.

It is as yet unclear whether the signs of strong competition from Qantas have dampened enthusiasm among prospective Virgin buyers.

Last week, Virgin’s administrator – Deloitte – told shareholders that there are 20 buyers showing interest in the airline.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

13 Comments

  • PB

    says:

    The ACCC is one of the most perverse, anti-business, screwy bureaucratic jobs for the boys that has ever been foisted on the Australian public.
    It was formed, at great taxpayers expense, purportedly to protect consumers from anti-trust and monopoly gouging, yet, here it is, threatening a viable business (Qantas) with God only knows what in case Qantas offers bucket shop fares in order to stimulate the market.
    Qantas and Virgin need to lure customers back, and the only way to do that is price. If that takes a $19 fare then so be it, but get those punks at the ACCC out of the faces of legitimate business.

  • In Jetstar offering $19 fares it is similar to what Ryanair did so successfully in Europe. Their GBP9 fares were plus airport and government taxes!Then you really saw how many pigs had their snouts in the trough!
    When the fares are offered here they should be PLUS airport and security charges and we would all see how much our greedy property moguls running airports are taking from us to fly before they get the outrageous parking charges and up to 35% of the sale price on our retail purchases .
    Whilst we focus on airfares we never see how much the airport (s) are charging.

  • Dave

    says:

    Surely the ACCC can’t be serious? This virus has plummeted Qantas’ passenger numbers to single digit load factors so it needs to stimulate the air travel (and overall tourism) market back to some sustainable level any way it can. To think that cheap fares is anticompetitive and can damage Virgins’ potential buyer outlook reminds me of the draconian Two Airline policy of yesteryear. I thought Joe Public was crying over the thought of skyrocketing airfares post crisis, so how does this help that perception?

  • Alan

    says:

    What a moronic comment. Shame! You are probably a Qantas employee

  • Bob Brinckley

    says:

    Offering such give away fares is dumb. Many of todays financial problems for airlines world-wide link back to when the first low cost carriers offered super low fares in order to gain publicity. Fast forward to today and the average punter thinks that these fares are the every day fare and that everything else is a rip off. Hence today we have many airlines world wide going broke after limited cash flow for only a month or two. It is obvious that for many one days income was paying yesterdays bills with little cash in reserve.
    To survive post COVID 19 airlines need to educate the public of the need for sustainable airfares that actually cover cost.

  • Alan Flood

    says:

    To be fair it is Jetstar offering these fares as any LCC would in a normal sale. Virgin Australia is not an LCC and would be competing against Qantas on its on merits as a full service airline. Any stimulation post pandemic should be welcomed to restore public support in the industry and not the ACCC setting fare prices. There will no doubt be fare sales on all classes to stimulate demand, fuel costs are lower and leases on aircraft should no doubt drop with the surplus of planes on the ground looking for new lessors? The ACCC should be focused on the airports which have been the main culprits fleecing the industry and the ones airline are most aggrieved with!

    • John

      says:

      I know this ,while Joyce is running Qantas, I’ll walk or drive. the ACCC won’t restrict Qantas in anyway shape or form ,never have,that’s why a second domestic airline in this country struggles to be viable

  • The skies are mine!! Muhahahahahaaaa

    P.s. I like doodle

  • Peter Hannah

    says:

    IN Alan Joyce’s own words – “You could see Melbourne to Sydney fares on Jetstar for $39 – or even $19 – AND WE WOULD STILL COVER OUR CASH COSTS ON THOSE FLIGHTS!”

    Fantastic News!!

    THEN WHY THE HELL HAVE YOU BEEN CHARGING $169???????? pre-coronavirus?????????

    • Michael M

      says:

      You’re bang on Peter. As a weekly flyer between BNE and MEL I’m terrified of Qantas having a monopoly on Australian aviation.

    • Edwin

      says:

      It’s called ‘running a business’, also ‘supply & demand’ principle.
      Jetstar’s an LCC. QANTAS is a full service carrier.
      There’s a big difference between the two, & fares reflect this.

  • john

    says:

    $19 fares don’t even cover security & airport charges. Qantas would much rather sell you a seat at a loss now, than have you give the new airline any dollars.

    If you bought any fare with qantarse, doesn’t matter what fare new airline comes out with, you’re already flying with qantarse.

  • Ian

    says:

    EDWIN

    Selling below cost to stuff up a competitor is illegal. Qantas has very high costs compared with most airlines around the world.

Leave a Comment to Edwin Cancel

Your email address will not be published. Required fields are marked *

Consumer watchdog eyes Qantas’ cut-throat fares

written by Sandy Milne | May 7, 2020
A Boeing 737-8FE, operated by Virgin Australia (Source: Aviation Australia archives)

ACCC chairman Rod Sims has said that he is watching “extremely closely” to prevent anti-competitive behaviour from Qantas, as administrators work to resuscitate Virgin Australia.

The news comes after Qantas chief executive Alan Joyce hinted at post-virus bargains, designed to stimulate demand in the domestic travel sector.

“On Melbourne-Sydney you could see Jetstar have $39 airfares, you could see $19 airfares and we’ll still cover our cash costs on those flights,” he told investors on Tuesday.

Advertisement
Advertisement

However, rock-bottom deals like these could serve to price Virgin Australia out of the market. The ACCC has indicated in previous weeks that it will take swift action against any attempts to artificially push down prices or swamp airline routes.

According to Sims, cheap airfares alone are not cause for a breach of competitive practice laws. The commissioner said he is monitoring the situation as it unfolds for evidence of predatory pricing.

“It means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth,” said Sims.

“We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor.”

PROMOTED CONTENT

Sims also indicated that the ACCC is still investigating complaints brought by Virgin chief Paul Scurrah in March. At the time, Sims told the ABC that Scurrah believed that Qantas was “engaging in anti-competitive conduct, designed to damage Virgin as a competitor”.

It is as yet unclear whether the signs of strong competition from Qantas have dampened enthusiasm among prospective Virgin buyers.

Last week, Virgin’s administrator – Deloitte – told shareholders that there are 20 buyers showing interest in the airline.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

13 Comments

  • PB

    says:

    The ACCC is one of the most perverse, anti-business, screwy bureaucratic jobs for the boys that has ever been foisted on the Australian public.
    It was formed, at great taxpayers expense, purportedly to protect consumers from anti-trust and monopoly gouging, yet, here it is, threatening a viable business (Qantas) with God only knows what in case Qantas offers bucket shop fares in order to stimulate the market.
    Qantas and Virgin need to lure customers back, and the only way to do that is price. If that takes a $19 fare then so be it, but get those punks at the ACCC out of the faces of legitimate business.

  • In Jetstar offering $19 fares it is similar to what Ryanair did so successfully in Europe. Their GBP9 fares were plus airport and government taxes!Then you really saw how many pigs had their snouts in the trough!
    When the fares are offered here they should be PLUS airport and security charges and we would all see how much our greedy property moguls running airports are taking from us to fly before they get the outrageous parking charges and up to 35% of the sale price on our retail purchases .
    Whilst we focus on airfares we never see how much the airport (s) are charging.

  • Dave

    says:

    Surely the ACCC can’t be serious? This virus has plummeted Qantas’ passenger numbers to single digit load factors so it needs to stimulate the air travel (and overall tourism) market back to some sustainable level any way it can. To think that cheap fares is anticompetitive and can damage Virgins’ potential buyer outlook reminds me of the draconian Two Airline policy of yesteryear. I thought Joe Public was crying over the thought of skyrocketing airfares post crisis, so how does this help that perception?

  • Alan

    says:

    What a moronic comment. Shame! You are probably a Qantas employee

  • Bob Brinckley

    says:

    Offering such give away fares is dumb. Many of todays financial problems for airlines world-wide link back to when the first low cost carriers offered super low fares in order to gain publicity. Fast forward to today and the average punter thinks that these fares are the every day fare and that everything else is a rip off. Hence today we have many airlines world wide going broke after limited cash flow for only a month or two. It is obvious that for many one days income was paying yesterdays bills with little cash in reserve.
    To survive post COVID 19 airlines need to educate the public of the need for sustainable airfares that actually cover cost.

  • Alan Flood

    says:

    To be fair it is Jetstar offering these fares as any LCC would in a normal sale. Virgin Australia is not an LCC and would be competing against Qantas on its on merits as a full service airline. Any stimulation post pandemic should be welcomed to restore public support in the industry and not the ACCC setting fare prices. There will no doubt be fare sales on all classes to stimulate demand, fuel costs are lower and leases on aircraft should no doubt drop with the surplus of planes on the ground looking for new lessors? The ACCC should be focused on the airports which have been the main culprits fleecing the industry and the ones airline are most aggrieved with!

    • John

      says:

      I know this ,while Joyce is running Qantas, I’ll walk or drive. the ACCC won’t restrict Qantas in anyway shape or form ,never have,that’s why a second domestic airline in this country struggles to be viable

  • The skies are mine!! Muhahahahahaaaa

    P.s. I like doodle

  • Peter Hannah

    says:

    IN Alan Joyce’s own words – “You could see Melbourne to Sydney fares on Jetstar for $39 – or even $19 – AND WE WOULD STILL COVER OUR CASH COSTS ON THOSE FLIGHTS!”

    Fantastic News!!

    THEN WHY THE HELL HAVE YOU BEEN CHARGING $169???????? pre-coronavirus?????????

    • Michael M

      says:

      You’re bang on Peter. As a weekly flyer between BNE and MEL I’m terrified of Qantas having a monopoly on Australian aviation.

    • Edwin

      says:

      It’s called ‘running a business’, also ‘supply & demand’ principle.
      Jetstar’s an LCC. QANTAS is a full service carrier.
      There’s a big difference between the two, & fares reflect this.

  • john

    says:

    $19 fares don’t even cover security & airport charges. Qantas would much rather sell you a seat at a loss now, than have you give the new airline any dollars.

    If you bought any fare with qantarse, doesn’t matter what fare new airline comes out with, you’re already flying with qantarse.

  • Ian

    says:

    EDWIN

    Selling below cost to stuff up a competitor is illegal. Qantas has very high costs compared with most airlines around the world.

Leave a Comment to Edwin Cancel

Your email address will not be published. Required fields are marked *

Consumer watchdog eyes Qantas’ cut-throat fares

written by Sandy Milne | May 7, 2020
A Boeing 737-8FE, operated by Virgin Australia (Source: Aviation Australia archives)

ACCC chairman Rod Sims has said that he is watching “extremely closely” to prevent anti-competitive behaviour from Qantas, as administrators work to resuscitate Virgin Australia.

The news comes after Qantas chief executive Alan Joyce hinted at post-virus bargains, designed to stimulate demand in the domestic travel sector.

“On Melbourne-Sydney you could see Jetstar have $39 airfares, you could see $19 airfares and we’ll still cover our cash costs on those flights,” he told investors on Tuesday.

Advertisement
Advertisement

However, rock-bottom deals like these could serve to price Virgin Australia out of the market. The ACCC has indicated in previous weeks that it will take swift action against any attempts to artificially push down prices or swamp airline routes.

According to Sims, cheap airfares alone are not cause for a breach of competitive practice laws. The commissioner said he is monitoring the situation as it unfolds for evidence of predatory pricing.

“It means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth,” said Sims.

“We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor.”

PROMOTED CONTENT

Sims also indicated that the ACCC is still investigating complaints brought by Virgin chief Paul Scurrah in March. At the time, Sims told the ABC that Scurrah believed that Qantas was “engaging in anti-competitive conduct, designed to damage Virgin as a competitor”.

It is as yet unclear whether the signs of strong competition from Qantas have dampened enthusiasm among prospective Virgin buyers.

Last week, Virgin’s administrator – Deloitte – told shareholders that there are 20 buyers showing interest in the airline.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

13 Comments

  • PB

    says:

    The ACCC is one of the most perverse, anti-business, screwy bureaucratic jobs for the boys that has ever been foisted on the Australian public.
    It was formed, at great taxpayers expense, purportedly to protect consumers from anti-trust and monopoly gouging, yet, here it is, threatening a viable business (Qantas) with God only knows what in case Qantas offers bucket shop fares in order to stimulate the market.
    Qantas and Virgin need to lure customers back, and the only way to do that is price. If that takes a $19 fare then so be it, but get those punks at the ACCC out of the faces of legitimate business.

  • In Jetstar offering $19 fares it is similar to what Ryanair did so successfully in Europe. Their GBP9 fares were plus airport and government taxes!Then you really saw how many pigs had their snouts in the trough!
    When the fares are offered here they should be PLUS airport and security charges and we would all see how much our greedy property moguls running airports are taking from us to fly before they get the outrageous parking charges and up to 35% of the sale price on our retail purchases .
    Whilst we focus on airfares we never see how much the airport (s) are charging.

  • Dave

    says:

    Surely the ACCC can’t be serious? This virus has plummeted Qantas’ passenger numbers to single digit load factors so it needs to stimulate the air travel (and overall tourism) market back to some sustainable level any way it can. To think that cheap fares is anticompetitive and can damage Virgins’ potential buyer outlook reminds me of the draconian Two Airline policy of yesteryear. I thought Joe Public was crying over the thought of skyrocketing airfares post crisis, so how does this help that perception?

  • Alan

    says:

    What a moronic comment. Shame! You are probably a Qantas employee

  • Bob Brinckley

    says:

    Offering such give away fares is dumb. Many of todays financial problems for airlines world-wide link back to when the first low cost carriers offered super low fares in order to gain publicity. Fast forward to today and the average punter thinks that these fares are the every day fare and that everything else is a rip off. Hence today we have many airlines world wide going broke after limited cash flow for only a month or two. It is obvious that for many one days income was paying yesterdays bills with little cash in reserve.
    To survive post COVID 19 airlines need to educate the public of the need for sustainable airfares that actually cover cost.

  • Alan Flood

    says:

    To be fair it is Jetstar offering these fares as any LCC would in a normal sale. Virgin Australia is not an LCC and would be competing against Qantas on its on merits as a full service airline. Any stimulation post pandemic should be welcomed to restore public support in the industry and not the ACCC setting fare prices. There will no doubt be fare sales on all classes to stimulate demand, fuel costs are lower and leases on aircraft should no doubt drop with the surplus of planes on the ground looking for new lessors? The ACCC should be focused on the airports which have been the main culprits fleecing the industry and the ones airline are most aggrieved with!

    • John

      says:

      I know this ,while Joyce is running Qantas, I’ll walk or drive. the ACCC won’t restrict Qantas in anyway shape or form ,never have,that’s why a second domestic airline in this country struggles to be viable

  • The skies are mine!! Muhahahahahaaaa

    P.s. I like doodle

  • Peter Hannah

    says:

    IN Alan Joyce’s own words – “You could see Melbourne to Sydney fares on Jetstar for $39 – or even $19 – AND WE WOULD STILL COVER OUR CASH COSTS ON THOSE FLIGHTS!”

    Fantastic News!!

    THEN WHY THE HELL HAVE YOU BEEN CHARGING $169???????? pre-coronavirus?????????

    • Michael M

      says:

      You’re bang on Peter. As a weekly flyer between BNE and MEL I’m terrified of Qantas having a monopoly on Australian aviation.

    • Edwin

      says:

      It’s called ‘running a business’, also ‘supply & demand’ principle.
      Jetstar’s an LCC. QANTAS is a full service carrier.
      There’s a big difference between the two, & fares reflect this.

  • john

    says:

    $19 fares don’t even cover security & airport charges. Qantas would much rather sell you a seat at a loss now, than have you give the new airline any dollars.

    If you bought any fare with qantarse, doesn’t matter what fare new airline comes out with, you’re already flying with qantarse.

  • Ian

    says:

    EDWIN

    Selling below cost to stuff up a competitor is illegal. Qantas has very high costs compared with most airlines around the world.

Leave a Comment to Edwin Cancel

Your email address will not be published. Required fields are marked *

Consumer watchdog eyes Qantas’ cut-throat fares

written by Sandy Milne | May 7, 2020
A Boeing 737-8FE, operated by Virgin Australia (Source: Aviation Australia archives)

ACCC chairman Rod Sims has said that he is watching “extremely closely” to prevent anti-competitive behaviour from Qantas, as administrators work to resuscitate Virgin Australia.

The news comes after Qantas chief executive Alan Joyce hinted at post-virus bargains, designed to stimulate demand in the domestic travel sector.

“On Melbourne-Sydney you could see Jetstar have $39 airfares, you could see $19 airfares and we’ll still cover our cash costs on those flights,” he told investors on Tuesday.

Advertisement
Advertisement

However, rock-bottom deals like these could serve to price Virgin Australia out of the market. The ACCC has indicated in previous weeks that it will take swift action against any attempts to artificially push down prices or swamp airline routes.

According to Sims, cheap airfares alone are not cause for a breach of competitive practice laws. The commissioner said he is monitoring the situation as it unfolds for evidence of predatory pricing.

“It means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth,” said Sims.

“We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor.”

PROMOTED CONTENT

Sims also indicated that the ACCC is still investigating complaints brought by Virgin chief Paul Scurrah in March. At the time, Sims told the ABC that Scurrah believed that Qantas was “engaging in anti-competitive conduct, designed to damage Virgin as a competitor”.

It is as yet unclear whether the signs of strong competition from Qantas have dampened enthusiasm among prospective Virgin buyers.

Last week, Virgin’s administrator – Deloitte – told shareholders that there are 20 buyers showing interest in the airline.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

13 Comments

  • PB

    says:

    The ACCC is one of the most perverse, anti-business, screwy bureaucratic jobs for the boys that has ever been foisted on the Australian public.
    It was formed, at great taxpayers expense, purportedly to protect consumers from anti-trust and monopoly gouging, yet, here it is, threatening a viable business (Qantas) with God only knows what in case Qantas offers bucket shop fares in order to stimulate the market.
    Qantas and Virgin need to lure customers back, and the only way to do that is price. If that takes a $19 fare then so be it, but get those punks at the ACCC out of the faces of legitimate business.

  • In Jetstar offering $19 fares it is similar to what Ryanair did so successfully in Europe. Their GBP9 fares were plus airport and government taxes!Then you really saw how many pigs had their snouts in the trough!
    When the fares are offered here they should be PLUS airport and security charges and we would all see how much our greedy property moguls running airports are taking from us to fly before they get the outrageous parking charges and up to 35% of the sale price on our retail purchases .
    Whilst we focus on airfares we never see how much the airport (s) are charging.

  • Dave

    says:

    Surely the ACCC can’t be serious? This virus has plummeted Qantas’ passenger numbers to single digit load factors so it needs to stimulate the air travel (and overall tourism) market back to some sustainable level any way it can. To think that cheap fares is anticompetitive and can damage Virgins’ potential buyer outlook reminds me of the draconian Two Airline policy of yesteryear. I thought Joe Public was crying over the thought of skyrocketing airfares post crisis, so how does this help that perception?

  • Alan

    says:

    What a moronic comment. Shame! You are probably a Qantas employee

  • Bob Brinckley

    says:

    Offering such give away fares is dumb. Many of todays financial problems for airlines world-wide link back to when the first low cost carriers offered super low fares in order to gain publicity. Fast forward to today and the average punter thinks that these fares are the every day fare and that everything else is a rip off. Hence today we have many airlines world wide going broke after limited cash flow for only a month or two. It is obvious that for many one days income was paying yesterdays bills with little cash in reserve.
    To survive post COVID 19 airlines need to educate the public of the need for sustainable airfares that actually cover cost.

  • Alan Flood

    says:

    To be fair it is Jetstar offering these fares as any LCC would in a normal sale. Virgin Australia is not an LCC and would be competing against Qantas on its on merits as a full service airline. Any stimulation post pandemic should be welcomed to restore public support in the industry and not the ACCC setting fare prices. There will no doubt be fare sales on all classes to stimulate demand, fuel costs are lower and leases on aircraft should no doubt drop with the surplus of planes on the ground looking for new lessors? The ACCC should be focused on the airports which have been the main culprits fleecing the industry and the ones airline are most aggrieved with!

    • John

      says:

      I know this ,while Joyce is running Qantas, I’ll walk or drive. the ACCC won’t restrict Qantas in anyway shape or form ,never have,that’s why a second domestic airline in this country struggles to be viable

  • The skies are mine!! Muhahahahahaaaa

    P.s. I like doodle

  • Peter Hannah

    says:

    IN Alan Joyce’s own words – “You could see Melbourne to Sydney fares on Jetstar for $39 – or even $19 – AND WE WOULD STILL COVER OUR CASH COSTS ON THOSE FLIGHTS!”

    Fantastic News!!

    THEN WHY THE HELL HAVE YOU BEEN CHARGING $169???????? pre-coronavirus?????????

    • Michael M

      says:

      You’re bang on Peter. As a weekly flyer between BNE and MEL I’m terrified of Qantas having a monopoly on Australian aviation.

    • Edwin

      says:

      It’s called ‘running a business’, also ‘supply & demand’ principle.
      Jetstar’s an LCC. QANTAS is a full service carrier.
      There’s a big difference between the two, & fares reflect this.

  • john

    says:

    $19 fares don’t even cover security & airport charges. Qantas would much rather sell you a seat at a loss now, than have you give the new airline any dollars.

    If you bought any fare with qantarse, doesn’t matter what fare new airline comes out with, you’re already flying with qantarse.

  • Ian

    says:

    EDWIN

    Selling below cost to stuff up a competitor is illegal. Qantas has very high costs compared with most airlines around the world.

Leave a Comment to Edwin Cancel

Your email address will not be published. Required fields are marked *

Consumer watchdog eyes Qantas’ cut-throat fares

written by Sandy Milne | May 7, 2020
A Boeing 737-8FE, operated by Virgin Australia (Source: Aviation Australia archives)

ACCC chairman Rod Sims has said that he is watching “extremely closely” to prevent anti-competitive behaviour from Qantas, as administrators work to resuscitate Virgin Australia.

The news comes after Qantas chief executive Alan Joyce hinted at post-virus bargains, designed to stimulate demand in the domestic travel sector.

“On Melbourne-Sydney you could see Jetstar have $39 airfares, you could see $19 airfares and we’ll still cover our cash costs on those flights,” he told investors on Tuesday.

Advertisement
Advertisement

However, rock-bottom deals like these could serve to price Virgin Australia out of the market. The ACCC has indicated in previous weeks that it will take swift action against any attempts to artificially push down prices or swamp airline routes.

According to Sims, cheap airfares alone are not cause for a breach of competitive practice laws. The commissioner said he is monitoring the situation as it unfolds for evidence of predatory pricing.

“It means we the ACCC need to be watching very carefully as this new player emerges to make sure that its ability to be an effective competitor is not killed at birth,” said Sims.

“We just need to make sure there’s no conduct that has the purpose or effect of squashing a competitor.”

PROMOTED CONTENT

Sims also indicated that the ACCC is still investigating complaints brought by Virgin chief Paul Scurrah in March. At the time, Sims told the ABC that Scurrah believed that Qantas was “engaging in anti-competitive conduct, designed to damage Virgin as a competitor”.

It is as yet unclear whether the signs of strong competition from Qantas have dampened enthusiasm among prospective Virgin buyers.

Last week, Virgin’s administrator – Deloitte – told shareholders that there are 20 buyers showing interest in the airline.

Steer your own in-flight experience – available on print and digital Whether our classic glossy magazine in your letterbox, daily news updates in your inbox, peeling back a few layers in the podcast or our monthly current affair reports, you can count on us to keep you up to date. Sign up today for just $99.95 for more exclusive offers here. Subscribe now at australianaviation.com.au.

13 Comments

  • PB

    says:

    The ACCC is one of the most perverse, anti-business, screwy bureaucratic jobs for the boys that has ever been foisted on the Australian public.
    It was formed, at great taxpayers expense, purportedly to protect consumers from anti-trust and monopoly gouging, yet, here it is, threatening a viable business (Qantas) with God only knows what in case Qantas offers bucket shop fares in order to stimulate the market.
    Qantas and Virgin need to lure customers back, and the only way to do that is price. If that takes a $19 fare then so be it, but get those punks at the ACCC out of the faces of legitimate business.

  • In Jetstar offering $19 fares it is similar to what Ryanair did so successfully in Europe. Their GBP9 fares were plus airport and government taxes!Then you really saw how many pigs had their snouts in the trough!
    When the fares are offered here they should be PLUS airport and security charges and we would all see how much our greedy property moguls running airports are taking from us to fly before they get the outrageous parking charges and up to 35% of the sale price on our retail purchases .
    Whilst we focus on airfares we never see how much the airport (s) are charging.

  • Dave

    says:

    Surely the ACCC can’t be serious? This virus has plummeted Qantas’ passenger numbers to single digit load factors so it needs to stimulate the air travel (and overall tourism) market back to some sustainable level any way it can. To think that cheap fares is anticompetitive and can damage Virgins’ potential buyer outlook reminds me of the draconian Two Airline policy of yesteryear. I thought Joe Public was crying over the thought of skyrocketing airfares post crisis, so how does this help that perception?

  • Alan

    says:

    What a moronic comment. Shame! You are probably a Qantas employee

  • Bob Brinckley

    says:

    Offering such give away fares is dumb. Many of todays financial problems for airlines world-wide link back to when the first low cost carriers offered super low fares in order to gain publicity. Fast forward to today and the average punter thinks that these fares are the every day fare and that everything else is a rip off. Hence today we have many airlines world wide going broke after limited cash flow for only a month or two. It is obvious that for many one days income was paying yesterdays bills with little cash in reserve.
    To survive post COVID 19 airlines need to educate the public of the need for sustainable airfares that actually cover cost.

  • Alan Flood

    says:

    To be fair it is Jetstar offering these fares as any LCC would in a normal sale. Virgin Australia is not an LCC and would be competing against Qantas on its on merits as a full service airline. Any stimulation post pandemic should be welcomed to restore public support in the industry and not the ACCC setting fare prices. There will no doubt be fare sales on all classes to stimulate demand, fuel costs are lower and leases on aircraft should no doubt drop with the surplus of planes on the ground looking for new lessors? The ACCC should be focused on the airports which have been the main culprits fleecing the industry and the ones airline are most aggrieved with!

    • John

      says:

      I know this ,while Joyce is running Qantas, I’ll walk or drive. the ACCC won’t restrict Qantas in anyway shape or form ,never have,that’s why a second domestic airline in this country struggles to be viable

  • The skies are mine!! Muhahahahahaaaa

    P.s. I like doodle

  • Peter Hannah

    says:

    IN Alan Joyce’s own words – “You could see Melbourne to Sydney fares on Jetstar for $39 – or even $19 – AND WE WOULD STILL COVER OUR CASH COSTS ON THOSE FLIGHTS!”

    Fantastic News!!

    THEN WHY THE HELL HAVE YOU BEEN CHARGING $169???????? pre-coronavirus?????????

    • Michael M

      says:

      You’re bang on Peter. As a weekly flyer between BNE and MEL I’m terrified of Qantas having a monopoly on Australian aviation.

    • Edwin

      says:

      It’s called ‘running a business’, also ‘supply & demand’ principle.
      Jetstar’s an LCC. QANTAS is a full service carrier.
      There’s a big difference between the two, & fares reflect this.

  • john

    says:

    $19 fares don’t even cover security & airport charges. Qantas would much rather sell you a seat at a loss now, than have you give the new airline any dollars.

    If you bought any fare with qantarse, doesn’t matter what fare new airline comes out with, you’re already flying with qantarse.

  • Ian

    says:

    EDWIN

    Selling below cost to stuff up a competitor is illegal. Qantas has very high costs compared with most airlines around the world.

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