Qantas’ exorbitant airfares may have contributed to inflation: Report

Qantas Airbus A380 at London Heathrow airport. Qantas is the flag carrier of Australia and has 12 A380s in fleet.
Edited by Travel Weekly

    An inquiry by the Australian Council of Trade Unions has found that Qantas reducing its domestic capacity and upping airfares in 2022 may have contributed to inflation and raised interest rates.

    The inquiry, which was led by former Australian Competition and Consumer Commission (ACCC) chairman, Allan Fels, examined price gouging across the Australian economy and found Aussies are paying too much for everything from groceries to travel.

    The company that found itself named and shamed in the travel industry was the National Carrier.

    “Qantas’ ability to reduce supply while increasing prices, and suffering no material loss of market share, may have affected CPI [inflation] in December 2022, and therefore may have impacted the Reserve Bank’s inflation expectations and rate increases,” Fels said in the report.

    Fels lambasted the aviation duopoly in Australia, which is dominated by Qantas, arguing that the ACCC should have more power in order to tackle anti-competitive behaviour. Currently, Qantas Group and Virgin Australia own over 90 per cent of the commercial aviation market in Australia.

    Qantas and Virgin Australia comprise the Australian aviation duopoly (iStock/BeyondImages)

    “Changes to the competition law could be done very quickly,” Fels said. “That could be done, introduced into parliament within two or three months.”

    Qantas cut its domestic capacity by 10 per cent in May 2022. The airline said it was “adjusting its domestic capacity levels for much of FY23 to assist with the recovery of sustained high fuel prices”. Qantas then went on to cut capacity by a further 5 per cent in July and August and by another 10 per cent in October.

    Fels argued that Qantas’ reductions hurt particularly badly at this time because of revenge travel’s surge, contributing towards inflation.

    “Qantas fare increases over the three months to December 2022 were large enough to produce a sizable increase in the ‘holiday travel and accommodation’ contribution to inflation,” Fels said.

    Fels said the most egregious example of price gouging was that Qantas’ airfares were 30 per cent higher due to the Albanese Government’s controversial decision to block additional capacity for Qatar Airways.

    “Well, where do you start? I thought the Qantas airfares were 30 per cent higher because of the blocking of Qatar,” Fels told ABC.

    “[But] with airlines there is room to quickly remove the anticompetitive restrictions that apply both domestically and international.”

    Qatar was looking to add 28 flights per week into hubs such as Brisbane, Sydney, Melbourne and Perth from the Middle East in July last year, but this was blocked by Transport Minister Catherine King.

    The Federal Government sought out the opinion of Qantas as part of Qatar Airways’ application process for bilateral air rights. Qantas opposed the bid on the grounds that it would cause Australian job losses, according to The Australian.

    Qantas has responded to Fels’ report, arguing that “the temporary spike in fares post-COVID reflected reductions in capacity to improve operational resilience following the challenging restart of the industry once borders opened”.

    “These reductions coincided with a period of high demand and the imbalance pushed up fares across all airlines. At the same time, fuel prices increased by more than 60 per cent, driving fares higher again.”

    In his report, Fels also noted the high rates of cancellations in 2022, which is currently under investigation by the commission. Qantas’ cancellation rate was 2 per cent between 2017-19, while this jumped to 4.4 per cent in 2022-23.

    “Qantas’ service delivery returning from the pandemic shut down became so derided the term ‘Joyced’ (a reference to then CEO Alan Joyce) entered into popular Australian usage to ‘describe being severely inconvenienced at an airport by flight cancellations or luggage going astray’,” Fels said.

    Fels also aired concern about price gouging in the electricity sector, which he said needs urgent investigation.

    (Featured Image: Qantas Airbus A380 – iStock/tupungato)

    Email the Travel Weekly team at


    Latest News

    • Travel Weekly TV

    Renaissance Tours’ Evan Petrelis on how to execute special interest travel: Travel Weekly TV

    This week on Travel Weekly TV Evan Petrelis gives Nancy the scoop on how special interest tours are planned, and what you can expect on an incredible holiday with Renaissance Tours. Renaissance Tours encompass the far-reaching ‘arts’ field, operating deep dives on art, archaeology, architecture, music, dance, gardens food and wine! Quite the list… One […]

    • News
    • Travel Agents

    CATO commemorates 25 years of industry leadership and innovation

    The Council of Australian Tour Operators (CATO) commemorated its 25th anniversary with a gala dinner at the Sydney Hilton Hotel that marked a significant milestone in its history. The celebration last Thursday was attended by 100 members and industry stalwarts, and was generously sponsored by CATO’s Platinum Partners: TravelPay, Gow Gates, and MINT Payments. Since […]

    • Aviation

    Qantas bolsters Link fleet with 33 new Dash 8 turboprops

    Qantas has today announced new investment in its DeHavilland Dash 8 turboprop fleet as part of its ongoing commitment to keeping regional Australia connected. The national carrier will acquire 14 additional mid-life Dash 8-400 aircraft (Q400), with 19 smaller Q200 and Q300 turboprop aircraft to be gradually phased out of the fleet. The first aircraft […]

    • Cruise
    • News

    Seabourn sails into Broome for the first time

    Seabourn Pursuit, Seabourn’s newest luxury, purpose-built expedition vessel, made its maiden arrival at Broome on the morning of Saturday 22nd June. The ship is sailing in the Kimberley for the first time on a series of 10-day voyages between Darwin and Broome from June to August 2024.   Seabourn president Natalya Leahy, along with vice president […]

    • Aviation
    • Destinations

    Singapore Airlines to launch flights to Beijing Daxing from November

    Singapore Airlines (SIA) has announced a new daily route between its capital city hub and Beijing’s Daxing International Airport. The flights are set to begin operating from 11 November 2024 assuming there are no complications with regulatory approvals. Located in the south of Beijing, the airport gives customers convenient access to the Beijing, Hebei, and […]

    • News

    Touropa adds European river cruises to product offering

    Touropa, the flexible coach touring company, have announced an exciting extension of its travel programme to include more than 100 European River Cruise departures. Touropa, a collaboration between Sun Island Tours and Europamundo Vacations, is a global touring provider renowned for its extensive range of flexible and affordable travel options, and this expansion is aimed […]

    • Events

    Christmas in July 2024 program

    The four-day winter extravaganza unveils its exciting 2024 program as locals and guests get ready for XMAS in July from 27 to 30 June. Park Lanes Lawn will be the heart of the festival, offering a holiday experience with music, gastronomy, artisan crafts. Free Christmas shows, concerts, and more The festival kicks off with the […]

    • Destinations

    Victoria’s Rutherglen named Australia’s trendiest location

    Melbourne is often dubbed as Australia’s trendiest and coolest city, however, there are plenty of other up-and-coming regions vying for that title, including Victoria’s Rutherglen. B2C Furniture did an analysis of every major Australian city, ranking the number of cafes, markets, vintage shops, theatres, street art murals, and art galleries. They then created a custom […]

    • Health & Wellness
    • News

    Two Australian beaches named in the top 10 nudist beaches globally

    A recent study identified the best nudist beaches in the world and it was good news for freedom-loving Aussies, with two Australian beaches making it to the top of the list.  Experts from identified the world’s best beaches for nudists by factoring in categories such as safety index, average sunshine hours, summer water temperature, […]

    • Hotels

    Opening of Argini Hotel in Syros Greece

    Located in cosmopolitan Vaporia in Ermoupolis, Syros, the Argini Hotel has opened its doors at the world’s second most welcoming city for 2024. Built in 1853 to house the family of Gregoris Paikos, a leading figure in the Greek Revolution, Argini Hotel was renovated with ethos, modern artistry, and utter respect to its neoclassical history. […]

    • Attractions
    • First Nations

    Australian National Maritime Museum celebrates NAIDOC week

    The Australian National Maritime Museum kicks off NAIDOC Week 2024 with a Family Fun Day on Sunday, 7 July, honouring the theme “Keep the Fire Burning! Blak, Loud, and Proud”. NAIDOC Week gives all Australians a chance to celebrate and recognise the history, culture, and achievements of the Aboriginal and Torres Strait Islander people. The […]

    • Food & Beverage

    Nobu Bangkok the World’s Highest Nobu Restaurant at EA Rooftop at The Empire

    Nobu co-founders Hollywood star Robert De Niro and Meir Teper, plus eponymous chef Nobu Matsuhisa have visited EA Rooftop at the Empire ahead of the official launch of the world’s highest Nobu restaurant in the heart of Bangkok. With unparalleled dining experiences with breathtaking panoramic views of the Bangkok skyline and the Chao Phraya River, […]

    • Hotels

    Nesuto celebrates five years of success with five five-night stay vouchers competition

    Nesuto is offering guests the chance to win one of five five-night stay vouchers that can be used at any Nesuto apartment or apartment hotel across Australia and New Zealand as part of its 5th anniversary celebration. Guests and team members are invited to contribute to a digital time capsule that captures their favourite memories, […]

    • Cruise

    Viking Cruises special 8-day cruise rate

    Viking cruises is providing a special offer on its 8-day Rhine Getaway itinerary for November 2024 departures with a strictly limited basis. The cruise takes guests out to discover the charm of old-world Europe as they sail through Netherlands, Germany, France, and Switzerland. The itinerary includes visits the turreted fortresses, grand cathedrals, and medieval towns […]