Qantas airfare sale puts squeeze on Virgin

Qantas fires first fare war shots with 350,000 discounted seats from $109 one way with 40 routes available from under $150.

Qantas has launched its second major airfare sale in as many weeks, days after struggling rival Virgin Australia announced its ‘comeback sale’.

Qantas has upped the ante on struggling rival Virgin Australia, announcing its second massive fare sale in two weeks.

From Monday to Friday, Qantas will offer 350,000 discounted fares from $109 one way, with 40 routes available from under $150.

It comes after an end-of-financial year sale with low fares partner Jetstar, that offered 200,000 heavily discounted fares and triple frequent flyer points on Qantas bookings.

The timing of the latest sale will coincide with Virgin Australia’s own ramping up of flights in August, and over the September-October school holidays.

The rival carrier announced its push back into the domestic market last Thursday and a “comeback sale” after an injection of desperately needed funds from new owner Bain Capital.

Virgin Australia went into administration on April 21 with debts of $6.8bn.

Qantas chief customer officer Stephanie Tully said their cheap fares were part of efforts to revive the tourism industry devastated by COVID-19.

“The response we saw to the recent sales exceeded our expectations and showed just how much demand there is for people to get on an aircraft and get away,” Ms Tully said.

“We expect this sale will help stimulate demand even more and encourage Australians to go on holidays and visit family and friends while also helping get more of our people back working again.”

Sale fares of $109 were available for Sydney-Gold Coast and Sydney-Hervey Bay, $115 for Brisbane-Sydney and $139 for Brisbane-Cairns.

In comparison, Virgin Australia was promoting discount fares of $69 for Sydney-Ballina, $129 for Canberra-Gold Coast and business class fares for Sydney-Gold Coast of $299.

Qantas is under scrutiny from the Australian Competition and Consumer Commission for any anti-competitive behaviour that could damage Virgin Australia’s chances of success as the airline emerges from administration.

At the request of the federal government, the ACCC was monitoring Australia’s domestic aviation industry with the help of nine extra employees.

Regional Express (Rex) airlines has also demanded Canberra axe all financial assistance for Qantas on the back of the larger carrier’s announcement it would launch flights from Sydney to Orange.

A statement by Rex said the move was clearly predatory given low demand on the route.

“Orange currently averages a total of 40 passengers per week and barely fills up 30 per cent of Rex’s twice weekly return flights,” said the statement.

“Qantas intends to flood the market with another 216 seats a week making it an aggregate load factor of 11 per cent for the two carriers.”

A QantasLink spokesman said Rex was clearly uncomfortable about facing competition and seeing their monopoly on flights to Orange come to an end.

“Rex sees their plans to expand into domestic routes as good for competition, but when a route they have had a monopoly on for decades faces some competition they say it’s predatory behaviour,” he said.

“We have a long history of serving regional Australia and we’ll continue to invest in communities where there’s sustainable demand for our services.”

Rex recently flagged plans to compete with Qantas and Virgin on “Golden Triangle” routes between Sydney, Melbourne and Brisbane after raising $30m for narrow body jets.

All major airlines have suffered considerable financial losses as a result of the COVID-19 crisis and crippling travel restrictions.

Qantas is set to axe 6000 jobs from its 29,000-strong workforce, and Virgin Australia’s staff is expected to be whittled down from 9000 to between 5000 and 6000.