New data finds airfares soar as airlines squeeze capacity

 

New data from the Bureau of Infrastructure, Transport and Regional Economics (BITRE) reveals that domestic airfares have increased by almost 19 per cent over the past three years[1], more than three times the rate of inflation[2].

 

The data shows that between August 2016 -2019 domestic airfares increased by 18.6 per cent as airlines continued to constrain seat capacity.

 

Passenger numbers increased by more than four per cent over the same three-year period while the supply of seats has only increased by 0.3 per cent[3].

 

Australian Airports Association Chief Executive Officer Caroline Wilkie said passengers should not have to keep paying more.

 

“The airlines should stop playing games with the public and start offering more affordable airfares,” Ms Wilkie said.

 

“The domestic carriers are very quick to attack suppliers and aviation partners when they think they’re getting a raw deal, yet they’re happy to slug travellers with pricey, uncompetitive airfares – because they can.”

 

The BITRE data shows that total domestic passenger numbers have increased by 2.5 million over the past three years, while the number of extra seats made available by the airlines increased by just 265,000.

 

“This equates to one seat for every 9.5 additional passengers in the past three years. It’s about time the airlines did the right thing and opened up more seats to keep the cost of flying in Australia as affordable as possible,” Ms Wilkie said.

 

“The economy needs a boost right now and that could be assisted by increased domestic tourism if flights were more affordable.”

 

The Productivity Commission has confirmed airport charges make up a small portion of airfares and have little impact on the price of a ticket.

ENDS

16 September 2019

[1] BITRE Australian Domestic Airfare Indexes, annual average of best discount airfare to August 2019

[2] CPI inflation, ABS Cat. 6401

[3] BITRE Australian Domestic Airline Activity, annual total of domestic passengers and seats to June 2019

 

Download PDF