How will the Australian Travel Industry cope with rising prices?
The Australian Travel Industry is gearing up for a rough ride this year as airfares are set to rise by more than 5% because of the impact the Icelandic volcano had on the aviation industry.
The International Air Transport Association have put losses as a direct result of the volcano, at $1.7 billion USD and that’s not including reimbursements made to passengers for expenses incurred. Add to that figure the rising price of oil and you could start to see an end to the cheap flights that passengers have enjoyed for so long.
The Centre for Economics and Business Research estimate that each passenger from the UK could expect to pay an extra £48 each on air fare. By 2012 prices could rise by as much as 11.5%. At the moment the best travel price to Australia from the UK for the first week in May is £660 with Emirates. If prices go up by 11.5 this price would be around £736 that’s almost £80 more expensive and that’s the cheapest price we could find, if you travel in peak time, around December/January the best fare offered by BA is £1260, with an 11.5% increase this would soar to £1405.
Kelkoo managing director Bruce Fair said of the estimated increases: “Most airlines were already struggling prior to the crisis, but this, combined with soaring oil prices, will have a knock-on effect on consumers as carrier are forced to pass on rising operational costs to passengers.”
All of this is bad news for international travellers. Many visitors travel to Australia around Christmastime to visit friends and family living in Australia, the rising costs may mean that for many the trip becomes unaffordable. Tourism also plays a large part in sustaining the Australian economy, injecting around $25 billion last year alone.
Increasing competition and less demand also hit airlines hard, making 2009 a year of negative profitability. It is expected that 2010 will incur even more losses for airlines and will leave many passengers struggling to pay higher prices.
One way to beat the rising costs of airline travel to Australia is to book well in advance. Compare flight prices at least six months before you go if possible and book well ahead. If you can be flexible with your dates there are many special offers to be had and if you are in a hurry, most websites offer late deals. Shop around because there are still bargains to be had out there for the canny traveller.
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