The cost of Australian airfares has risen 5% in the past 12 months, following a surge in the first quarter of this year, new data has shown.
Rising demand, increasing oil prices and fuel surcharges drove airfares across the Asia-Pacific upwards in the first quarter of 2011, according to research by American Express in its Business Travel Monitor.
But Australian fares saw the most dramatic increases, posting an overall 5% increase in the past 12 months and 2% increase in the first quarter of the year.
Full and discounted business class fares rose by 5% and 6% respectively in the past year, and all fare types in economy climbed 5%.
Australian domestic fares climbed 7% in the past 12 months and 3% in the first quarter, while fares to Europe rose 2% and America by 4% in the past year.
Dr Carl Jones, director of advisory services for American Express Business Travel, attributed the increases to a number of factors.
“Carriers are being much more cautious in adding capacity back into the market,” he said. “Labour issues and rising oil prices are squeezing margins, and airlines need to be absolutely sure before they increase the number of available seats.
“Increased competition to the Americas is also boosting competition Down Under,” Jones added.
In other markets, overall regional Asia-Pacific fares grew by 3% in the last 12 months and 1% in the first quarter, with the biggest increases in business and first class fares. Fares to Europe rose 4%, while America and Intra-Asia Pacific fares were up 1%.
Growing demand for business travel in 2011 is expected to trigger further fare increases, particularly in the Asia-Pacific region.