GT’s Radar has criticised the ACCC, Australia’s competition and consumer watchdog over a report that claims the country’s airlines have a cosy duopoly.
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In its headline-grabbing press release, it states in the first paragraph:
“A lack of effective competition in Australia’s domestic airline industry, which has
characterised the industry for decades, has resulted in higher airfares and poorer service for
consumers, the ACCC’s final Airline Competition in Australia report concludes.”
The reality is so different and now for the facts:
- Since 1990, 157 airlines, big and small have gone out of business or bankrupt in Australia, including Ansett, Compass 1 and 11, Impulse, Oz Jet and Virgin Australia.
- Since 2003 the average weekly earnings of an Australian has climbed 125% from $721 a week to $1621. Inflation has climbed 61% in the same period.
- Since 2003 the airfare index as provided by the BITRE and adjusted for CPI has declined by 46% for business class and 35% for the best economy fare.
Certainly, over the past 12 months, as the airline industry scrambled to get back on its feet there have been significant disruptions and airfare increases that spiked during school holidays.
The reasons are many but lack of capacity as airlines battled to get their fleets back from storage was a major contributor.
However, overall, the increase in fares over the last 12 months was only 10 per cent on average according to Australia’s BITRE.
In GT’s opinion, the ACCC has taken a narrow window to make sweeping statements which are not supported by the facts.
Disclosure: AirlineRatings.com like almost all commercial media in Australia accepts advertising from airlines such as Qantas and Virgin Australia.
