Qantas demand falling, Dixon says

[oz_mark]

Qantas Airways, Australia's top airline, said on Monday that passenger demand had fallen in all travel classes.

''There is a lessening in demand in all classes, Qantas has held up better than most airlines,'' said chief executive Geoff Dixon at the launch of its 20 Airbus A380 superjumbos, the world's largest airliner.

Qantas demand falling, Dixon says; ASX:QAN

 

[JohnK]

Under the circumstances of the global economic crisis lesser demand is to be expected.

Qantas share price is not looking too healthy at the moment....

 

[opusman]

Normal doctrine of supply + demand economics would suggest we should see fares start to fall soon.. will be interesting to see.

 

[Alanslegal]

It's simple, with demand falling and now the price of oil halved, its time to get rid of the fuel surcharges Mr. Dixon.

 

[simongr]

Not that simple really - cutting the fuel surcharge will eat into profits - in the same way that falling demand will. They also have to fund new aircraft.

It is not simple supply/demand either as the there is still not the competition on some routes which leads to inelastic supply movements.

 

[dajop]

Not that simple really - cutting the fuel surcharge will eat into profits - in the same way that falling demand will. They also have to fund new aircraft.

It is not simple supply/demand either as the there is still not the competition on some routes which leads to inelastic supply movements.

Also [from the airline perspective], better to play with fares rather than the surcharge. I don't how much of a difference it makes, but the demand for FF seats using points is probably going to fall less than demand for paid fares (in fact in times of financial tightening people might be more inclined to cash in their FF points on flights than pay full $$$). So important to maximise revenue from such bookings and that means not dropping any surcharges.