Sydney airfare prices fall on international routes

Sydney’s aviation and hotel industries are booming – but hopefully our international ticket prices won’t.

According to CWT Solutions Group – the consulting division of Carlson Wagonlit Travel, and CAPA (Centre for Aviation) – the average ticket price to Sydney on many international routes has decreased every year. If you frequent Hong Kong or Singapore the news is even better: prices have fallen more than five per cent year-on-year.

Meanwhile, the domestic average ticket price has been rising by over five per cent each year, between Sydney and almost all other major Aussie cities.

The findings, published in CAPA and CWT Solutions Group’s latest Business Travel Pulse report, dive into ticketing numbers, hotel stats and new flight routes.

“Sydney is very much at the heart of Australia’s aviation system both internationally and domestically,” said CAPA Executive Chairman, Peter Harbison.

“With very strong international growth, particularly from China, it is a key stepping off point for international tourism.

“Domestically, as the fare war between Qantas and Virgin subsides and capacity constraints, particularly in Sydney, we will begin to witness a gradual move upwards in fares.”

The upward move in fares comes after passenger numbers for Sydney increased by over five per cent in 2016 – and they are predicted to grow a further three per cent throughout 2017.

Airlines in 2017 are also showing the ability to absorb the growing demand with the introduction of several new services, including Vietnam Airlines’ Hanoi-Sydney service recently increased to three times a week. Cebu Pacific also plans to increase its Manila-Sydney frequency from four to at least seven times a week.

Richard Johnson, Director, Asia Pacific, CWT Solutions Group, said Asian and Middle Eastern airlines have evolved to keep up with growing passenger numbers, and more routes have become available between Asia and major Aussie cities.

“These factors create more choice for travelers and could be contributing to the decrease in international airfares,” he said.

As far as hotels are concerned, Sydney has the highest occupancy rate in Australia at 89 per cent. The report reveals that occupancy is expected to remain that way in 2017, but average room rates have increased by over five per cent due to supply issues.

New hotels including the Travelodge Hotel at Sydney Airport and the Sofitel at Darling Harbour are opening in 2017, but are not expected to fully absorb the growing demand.

“We’ve seen evidence of booking times to access lead-in room rates extending as demand has increased,” said Johnson.

“Leisure travellers are often booking months in advance and the historical ‘best practice’ of at least 21 days out for business bookings has consequently also increased to around 30 days.”

“The consistently high occupancy rates that Sydney enjoys could attract foreign investment into the hospitality market and increase the hotel pipeline, facilitating more growth down the road,” added Johnson.

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