Emirates adds capacity but warns passengers not to expect cheaper airfares

As debate continues to rage over the Qatar Airways decision, Emirates has announced an increase in capacity into Sydney but warned prices won’t fall.

Qantas’s international partner Emirates has unveiled plans to send a third A380 into Sydney every day from November but warned the extra capacity will not reduce airfares, in a pointed rebuke to claims more flights from rival Qatar Airways would cut rates.

Emirates Australasia vice-president Barry Brown said capacity was only a “small part of airfares”, with airlines dealing with a string of higher costs across their operations from fuel and catering to airport charges and workers.

“Once you start layering on all these additional costs, while it may seem airfares are high, it’s not solely because of capacity – it’s all these compounding costs hitting us from all areas,” said Mr Brown.

“In spite of these challenges, we’re committed to strengthening our schedules as much as we can, and offering the essential connectivity that Australian travellers have come to know and expect of us.”

The comments came as debate continued to rage about the federal government’s decision to deny Qatar Airways an extra 21 flights a week into Australia after opposition from Qantas, a close partner of Emirates.

Emirates plans to send a third A380 into Sydney every day. Picture: Getty Images

Virgin Australia CEO Jayne Hrdlicka claimed the Qatar flights would reduce international fares almost immediately by as much as 40 per cent.

Mr Brown was reluctant to discuss the decision regarding Emirates’ competitor, but insisted it would not have a significant benefit to the Dubai-based carrier because demand was already off the scale.

“I wouldn’t say (Qatar’s) loss is our gain,” he said. “I think our product is our gain and that’s been our strength for the last 25 years. We’re seeing bookings pouring in for October and November, but also for next year.”

Nor was Mr Brown concerned that Emirates would be tainted by controversies engulfing partner Qantas, including a lawsuit alleging the airline sold tickets on more than 8000 already cancelled flights.

He said the questions the Australian Competition and Consumer Commission was asking were “unique to Qantas”. “It doesn’t involve us at all. We’re just looking from the outside in on that one,” Mr Brown said.

In August the ACCC approved the Qantas-Emirates partnership for another five years, ensuring the tie-up would outlast former CEO Alan Joyce.

Former Qantas CEO Alan Joyce, who signed the tie-up with Emirates in 2013. Picture: Bloomberg

It was Mr Joyce who first inked the deal with Emirates in 2013, which saw the airlines share revenue and passengers, and offer reciprocal frequent flyer benefits.

Mr Brown said he was sad to see Mr Joyce go “in the way that he did”, bringing his retirement forward by two months to help accelerate Qantas’s renewal.

“I think Alan has been a breath of fresh air to Qantas,” he said.

“He’s done a great job and the partnership arrangement that we’ve had with each other has been really strong, as evidenced by the customer relationships that we have and ultimately it’s the customers we both want to serve.”

Emirates’ move to an all A380 fleet into Sydney in the place of two A380s and one Boeing 777 was complemented by twice-daily A380 flights into Melbourne, and daily A380 services into Perth and Brisbane.

A daily A350 service into Adelaide was also in the pipeline with flights expected to start in mid-2024.

Mr Brown said he promised Tourism Minister Don Farrell in January that Emirates would restart Adelaide services as soon as a suitable aircraft became available.

“Emirates’ addition of non-stop services to Adelaide is in lock-step with our commitment to Australia to expand and improve connectivity options for travellers,” said Mr Brown. We can’t wait to be back in Adelaide and once again play a key role in South Australians’ international travel plans.”

All three Emirates A380s operating out of Sydney every day will be fitted with the airline’s new premium economy product.

Tourism and travel industry leaders welcomed the extra Emirates capacity at a time when operators continued to recover from two years of closed borders.

Experience Co CEO John O’Sullivan, said “any additional capacity was good capacity” but said Australia lacked competition on long-haul routes to Europe.

“That’s still the industry’s issue. We’re sitting at 70 per cent of inbound arrivals (compared to pre-Covid) and to get back that 30 per cent really relies on airfares coming down,” Mr O’Sullivan said. “When we meet with trade partners, that’s the main problem – the price of flights is prohibitive.”

He agreed that it was a high inflationary environment but said Qatar’s business model was a contributing factor to lower airfares.

“That’s why the industry is so vocal around this point of approving additional capacity from a carrier like Qatar, because when they go into markets they introduce competitive fares,” he said. “That’s why the approval of those flights has become such an issue.”

Australian Tourism Export Council managing director Peter Shelley also welcomed Emirates’ announcement, but said competition was key.

“Our principle point is we need more competitive aviation capacity,” he said. “We’d absolutely welcome any additional capacity and we’d also welcome new entrants. Anything that will increase capacity and address competitiveness of price is our position.”

Originally published as Emirates adds capacity but warns passengers not to expect cheaper airfares