Adelaide–Alice Springs economy fares double since April

Qantas Boeing 787-9 VH-ZND Emily Kame Kngwarreye touches down in Alice Springs. (Qantas/James Morgan)
Qantas Boeing 787-9 VH-ZND Emily Kame Kngwarreye touches down in Alice Springs. (Qantas/James Morgan)

The cheapest economy tickets between Adelaide and Alice Springs have doubled in price since April, as airlines react to increasing demand and oil prices.

The news, which covered tickets from both Qantas and Virgin, was contained in the ACCC’s latest report on the industry’s recovery from COVID.  It added domestic airfares are likely to keep increasing until October.

“Domestic airfares have been rising in recent months in response to growing demand for travel, high jet fuel prices and reduced capacity,” said the report.

“Figure 7 shows the change in the price index representing the cheapest discount airfares, weighted across the 70 busiest domestic routes. The price index compares changes in airfares relative to July 2003 (100 on the price index).

“The price index fell to an 11-year low of 47.5 in late April 2022 as demand temporarily eased after the Easter break.

“Since then, the combination of high jet fuel prices, increased demand and falling capacity has resulted in the index increasing to 73.8 in August 2022, representing a rise of 56 per cent over 4 months.

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“The ACCC has observed that certain routes have seen larger increases than others.

“From April 2022, the cheapest economy fares for both Qantas and Virgin have doubled on Adelaide to Alice Springs. Significant increases were also observed for Adelaide to and from the Gold Coast and Darwin.

“Routes to the Gold Coast from Cairns, Newcastle and Melbourne also saw an increase.

“Business airfares have also started to increase after remaining very low for the last 12 months. Figure 8 shows that the price index for the cheapest business class airfares has been below 50 for most of 2022, with business travel recovering more slowly than leisure.

“However, the index increased by 17 per cent in 2 months recording 54.5 in August.”

The price of jet fuel, meanwhile, has retreated from its peak in June, coinciding with the refining margin between jet fuel and Brent crude oil prices lowering from $80 per barrel in April to $49 in August.

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The report, which you can read in full here, also revealed how domestic airlines are significantly reducing capacity to mitigate the delays and cancellations caused by staff shortages and sickness.

The competition watchdog revealed the cut in seats for sale during the last few months came despite the local industry hitting 97 per cent of pre-COVID passenger numbers in June.

Last month, Qantas chief executive Alan Joyce issued a ‘formal apology’ to long-standing customers for the airline’s post-pandemic struggles.

“Over the past few months, too many of you have had flights delayed, flights cancelled, and bags misplaced,” Joyce said via video and an email. “On behalf of the national carrier, I want to apologise and assure you that we’re working hard to get back to our best.”

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