Cheap flights 'only months away'

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  1. kamchatsky

    kamchatsky Established Member

    Mar 8, 2006
    2,774
    534
    Somewhere in Sydney
    Cheap flights 'only months away' | NEWS.com.au Business

    ___________________________________________________________
    Cheap flights 'only months away'

    Andrew Carswell
    June 23, 2007 07:28am



    AUSTRALIA is merely months away from experiencing the first of Asia's promised budget airlines, with the arrival of Viva Macau heralding an new era in aviation.

    WHEN flight ZG9501 touches down at Sydney airport on August 15, the curtain will officially rise on an exciting new era in Australian aviation.

    Body: The first of Asia's new budget airlines -- Viva Macau -- will have arrived on Australia's eastern seaboard, bringing with it a gamut of ultra-cheap international fares.

    Diminutive and without fanfare, Viva Macau's introduction can only be viewed as the tip of the iceberg; a minor glimpse into the flood of cheap fares soon to inundate Australian passengers.

    It started with Jetstar's bold leap into the South-East Asia market, a perfectly-timed ploy by bigger brother Qantas to get a jump on its rivals.

    The plan worked, with Jetstar Asia offering never-seen-before prices to exotic destinations such as Bali, Phuket, Bangkok and Vietnam's bustling Ho Chi Minh City, with high yields to boot.

    Now the real challenge for Jetstar Asia begins as the Asian low-budget carriers, boasting third-world operating costs and cheap labour, move in for the kill.

    Viva Macau will be first and cashed-up Malaysian outfit AirAsia X will follow, while Singapore's Tiger Airways will hit the domestic market with 50 new Airbus A320s (announced yesterday).

    Hong Kong budget carrier Oasis is also looking in and India's Jet Airways has expressed interest.

    Rapidly expanding budget airlines Air Deccan (China), Adam Air (Indonesia), Spice Jet (India), Hong Kong Airways and Manadla Airlines (Indonesia) may follow suit.

    The result?

    According to the experts, a revolution in travel which will turn domestic and international pricing on its head and open up a world of cheap holiday opportunities to ordinary Australians.

    The Viva Macau promise is all-inclusive $305 fares from Sydney to the Chinese-Portuguese province of Macau, an introductory offer from August to October.

    Add to that fare a 30-minute ferry ride to Hong Kong and an Oasis flight to London and suddenly you have arrived in the UK having only spent $600, taxes included.

    Viva Macau boss Con Korfiatis is not backwards in coming forward about his plans for the carrier.

    He eventually wants daily Sydney services and flights into at least Melbourne and Sydney and has already added a further six Asian destinations later this year.

    But if Viva Macau is set to make a splash in Australia, Malaysian-based AirAsia X has set its eye on a deluge.

    Its routes plans are immense, and its highly protected fare details are expected to be considerably lower than Viva's, due to its cost-effective one-class layout.

    One credible source told The Saturday Daily Telegraph return tickets from Malaysia to London would set passengers back a mere $220, while similar promotional fares can be expected on Australian services.

    On its new website, AirAsia X flashes its formidable but speculative route map, either as a tease for hungry travellers or as a threat to its competition.

    The map includes 19 destinations in Europe from its Kuala Lumper hub, eight destinations in Australia and a plethora of links throughout Asia.

    Additionally, its short-haul sister airline AirAsia already has 45 South-East Asian destinations in operation.

    Based on known orders and current fleet, the AirAsia group will have 37,000 seats in the sky before 2012, compared to around 13,000 for Virgin Blue and just more than 10,000 for Jetstar.

    the Centre of Asia-Pacific Aviation spokesman Derek Sadubin believes AirAsia X will single-handedly revolutionise outbound travel from Australia.

    "AirAsia X is an interesting one because they are not going to have two classes of service like Jetstar Asia and Viva Macau have," he said.

    "They are going to cram 396 seats in an A330 aircraft, which is 18 per cent more than Airbus says the aircraft can carry in a normal two-class configuration.

    "It is the start of a new era in international outbound travel for Australia with fares that will be consistently low, not just seasonably low, which means more pressure on the incumbent carriers."

    The transition period will no doubt allow Jetstar Asia to maintain its dominant position, simply because it has the fleet to back it up and will take delivery of its new Boeing 787s next year.

    They will provide the bulk of the opportunity for cheap long haul travel for Australians in the short-to-medium term, Mr Sadubin said.

    AirAsia X, the predicted dominant force, will not have the fleet to beat Jetstar Asia in the next two years but they are expected to win on price.

    "It is not going to be the massive hit upfront from AirAsia X as they really can't get the kind of fleet structure that they need for at least another 12 months when their ordered aircraft start to arrive," he said.

    "AirAsia will be the price leader to South-East Asia, followed closely by Jetstar."

    Unlike Viva Macau, which will enjoy a monopoly on its less-travelled routes, AirAsia X says it will not entice passengers with introductory cheap fares only to bump them up six months later.

    AirAsia boss Tony Fernandes believes it is not only competition that will keep its fares low but its ideology.

    "Our philosophy is to get the fare as low as possible," Mr Fernandes said.

    While opportunities for outbound travel for Australians are about to burgeon, the domestic market will see even greater change.

    Singapore Airways budget offshoot Tiger Airways is moving to town in October and will tackle the usual suspects Qantas, Virgin Blue and Jetstar on the most coveted domestic routes.

    Tiger Airways boss Tony Davies has promised pre-tax single-digit specials on major routes including the lucrative Sydney to Melbourne run, a link Qantas has even tried to shield from Jetstar.

    According to several analysts, passengers can expect to see regular promotional free flights plus taxes and other ridiculous deals designed to ensure yields

    are maintained.

    The prospects looking forward for travellers have never been so bright.

    Let the battle begin.
     

  2. JohnK

    JohnK Veteran Member

    Mar 22, 2005
    40,244
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    BNE, SYD and CNX
    Could be some exciting times ahead for budget travellers and possibly the rest of us.

    High yields? Anyone have access to the actual figures?
     
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