Government to halve flight prices in $1.2bn tourism plan

[MEL_Traveller]

Not too many Rexy routes on the list. If you listen closely you can probably hear the howls of outrage in Rexland.

The head of Rex has come out to say the subsidy is available on routes dominated by Qantas - 70% so. Nothing left for Virgin or Rex

 

[The Flying Brick]

So the only question I have as a Frequent Flyer is will J seats be subsidized as well as the seats down the back?

 

[DC3]

So, half-price holiday flights now?

What about those doing it tough? No holidays for them.

 

[Mattg]

The head of Rex has come out to say the subsidy is available on routes dominated by Qantas - 70% so. Nothing left for Virgin or Rex

Right on cue

’QantasKeeper’: Rival airline fires up over discounted tickets

Regional Express has dubbed the new aviation support package as “QantasKeeper”, saying it and Virgin have been left the scraps of a measure that mostly supports the flying kangaroo.

www.news.com.au

According to the article, Rex is complaining that Qantas will get 70% of the money. The article also says that Qantas Group serves 70% of the domestic market.

Anyway, last time I checked, Burnie is a Rex destination. As were Kangaroo Island and Merimbula. Not to mention, Rex will be benefiting tremendously from the extension of RANS funding until September.

 

[dajop]

Right on cue

’QantasKeeper’: Rival airline fires up over discounted tickets

Regional Express has dubbed the new aviation support package as “QantasKeeper”, saying it and Virgin have been left the scraps of a measure that mostly supports the flying kangaroo.

www.news.com.au

According to the article, Rex is complaining that Qantas will get 70% of the money. The article also says that Qantas Group serves 70% of the domestic market.

Last time I checked, Burnie is a Rex destination. As were Kangaroo Island and Merimbula.

Not to mention, they'll be benefiting tremendously from the extension of RANS funding until September.

Out of the whole article, I would agree with questioning why AVV is in need of support, MEL-SYD has plenty of cheap airfares at the moment, and is it really that big of an incentive to travel Surf Coast/Great Ocean Road from AVV rather than MEL? It seems very much a JQ subsidy (and as an aside, purely anecdotal, bookings for our holiday house - located on Surf Coast - have been 20% higher (in dollar value) for first half of 2021 compared to first half of 2019 and not sure we are an exception, but if that is repeated across the coast, I really wonder what the fuss is about in that particular area.)

 

[Seat0B]

<sets alarm for 01 0001 Apr 21>

(which is a Thursday btw)

At first I thought this was an early April Fool's Day announcement - but seems to be for real!

 

[jb747]

The head of Rex has come out to say the subsidy is available on routes dominated by Qantas - 70% so. Nothing left for Virgin or Rex

Given that QF has approximately 70% of the market, it seems a logical sort of result. Or were Rex thinking that they should be given disproportionate help because, Rex.

 

[PineappleSkip]

I guess there’s MEL-BWT/MIM/OOL and SYD-OOL. But the Rex 737 routes don’t need any stimulation , the presence of three players on such routes do much more for making fares affordable than these sorts of subsidies ever will.

I have some sympathy for Rex, the boy who cried wolf too often, this time. The problem with MEL-OOL and SYD-OOL is that a prerequisite for the subsidy is you have to have been on the route for two years previously. That would mean QF, JQ and VA flights on these routes would qualify for the subsidy but ZL flights would not, on two out of four of their announced routes. There is a fairly obvious competition problem if your subsidy favours existing players and disadvantages new ones.

I'm sure that these nonsense results would not be intended but I'm equally sure this whole arrangement hasn't been thought through enough. I predict this half cooked subsidy cake will be remixed quite a lot before it goes back in the oven.

Cheers skip

 

[TheRealTMA]

Many premiers seem to be annoyed with the very limited choices. And from BNE there’s not much. Very interesting that almost all of the cheap flights go to marginal seat electorates.

 

[eastwest101]

Out of the whole article, I would agree with questioning why AVV is in need of support, MEL-SYD has plenty of cheap airfares at the moment, and is it really that big of an incentive to travel Surf Coast/Great Ocean Road from AVV rather than MEL? It seems very much a JQ subsidy (and as an aside, purely anecdotal, bookings for our holiday house - located on Surf Coast - have been 20% higher (in dollar value) for first half of 2021 compared to first half of 2019 and not sure we are an exception, but if that is repeated across the coast, I really wonder what the fuss is about in that particular area.)

Yes AVV is a weird one, thats just a JQ subsidy really.

Cynical people would say:

Coolongatta, Hamilton Is, Prosepine, Maroochy, Cairns, Merimbula, Burnie, Devonport, Launceston and western suburbs of Melbourne all marginal electorates. Alice Springs and Uluru probably not so much, but would be genuinely suffering lack of international visitors, Merimbula is a marginal electorate and Kangaroo Island an extra bailout for damage to their local economies from previous summer bushfires, WA punished for its isolationist stance, but with a mining boom underway not a large priority (just heard on the radio from the WA tourism board who were not happy).

But realistically, a lot of these destinations are popular locations for interstate and international tourists and would have higher dependence on the tourism industry than a lot of other places in Australia. There are a few notable omissions though, surely Darwin might have made a good case?

Not sure of the length of the subsidy but North QLD and Broome seem attractive destinations in winter, Northern Tasmania and Merimbula maybe not so much but if it stretches into summer the obviously that attractiveness flips over the other way.

From a policy standpoint, maybe all the announced subsidies should have been interstate routes to discourage state border shenanigans? The OOL subsidies to current operators but not offered to Rex will leave them open to possible ACCC action.

 

[jase05]

So the only question I have as a Frequent Flyer is will J seats be subsidized as well as the seats down the back?

My thoughts too.
Y seats could be $1 and I wouldn’t be interested.
Having said that I think it’s a pretty good offer from the government and hope it works

 

[zenyattamondatta]

The problem with MEL-OOL and SYD-OOL is that a prerequisite for the subsidy is you have to have been on the route for two years previously.

That does however nicely address situations such as an airline starting new routes during a pandemic in the hope of benefitting from government subsidies.

 

[flydoc]

But realistically, a lot of these destinations are popular locations for interstate and international tourists and would have higher dependence on the tourism industry than a lot of other places in Australia. There are a few notable omissions though, surely Darwin might have made a good case?

DRW has now been added, apparently after some last minute lobbying by one of the NT Senators. Routes appear to be DRW-CNS & DRW-BME.

 

[dk4]

Lack of options from Perth is disappointing

Well vote Liberal this weekend - 50% off flights with emergency water landings in the Peel Inlet if you do, haha.

Anyway, Alan Joyce has already announced the caveat, which no major commercial media organisation has got off the gravy train to pick up - "off-peak flights"...

 

[DC3]

Y seats could be $1 and I wouldn’t be interested.

You make a good point, even with the “”

 

[dajop]

I have some sympathy for Rex, the boy who cried wolf too often, this time. The problem with MEL-OOL and SYD-OOL is that a prerequisite for the subsidy is you have to have been on the route for two years previously.

On the flipside Rex gets protected on MEL-MIM,

The OOL situations would seem quite uncompetitive, as it will underwrite JQ to a large extent, and VA/QF to a lesser extent to complete with ZL. Fares on the MEL/SYD-OOL are already came down a heap since ZL entered the market.

If only the government could work on their half of a bubble with Singapore - cases are minimal here and many of those paying $700+ a night to staycation or the 85,000 people who've taken a cruise to nowhere, would happily fill a daily flight to each major city in Australia and really support the sector that is struggling the most - operators whose offering is much more appealing to international tourists than domestic. I wish!!

 

[RooFlyer]

RooFlyer said:
....when the government hands out free money....

Isn't that what Govt's are for? What's the alternative?

I guess ideally governments spend taxes on things like health, education etc, but I have no problem with stimulus money in certain circumstances - in spite of the fact that if I score one of the subsidised flight tickets, it will be the first $ I've received from the Federal government from either the GFC stimulus or during the whole pandemic thing .

But my point was rather the seemingly inevitable barrage of complaints when the free money is announced, rather than the funding itself.

 

[Seat0B]

Anyone who lives in or near Canberra are allowed to complain as there is not one flight from there!

Typical - the #canberratax

 

[Scarlett]

So, half-price holiday flights now?

What about those doing it tough? No holidays for them.

Let them eat cake?

Or at least the 1/3 of a piece of cake that serves as the VA 'snack'.

 

[AIRwin]

at least the 1/3 of a piece of cake that serves as the VA 'snack'.

For now...