Qantas rivals offer more long-haul routes as dollar crash looms

Qantas’ rivals are keeping the airline on its toes on international travel by launching new routes in and out of Australia, even as a weaker Australian dollar threatens to raise prices for Australians going overseas.

Ahead of the crucial mid-year season, data from travel agency Flight Centre shows outbound international airline capacity in Australia is at 101 per cent of pre-pandemic levels.

Responding to robust uptake from consumers, a number of airlines have unveiled new offerings: Emirates, Fiji, and United Airlines have signalled new international routes in the past week. From December, United Airlines will fly three times a week from Adelaide to San Francisco.

United Airlines flies from Sydney to San Francisco daily.Credit: iStock

The first direct route between Adelaide and the US is expected to serve growing demand for tourism and defence-industry related travel.

United said the route “will start as a seasonal service initially, with a possibility to increase in the future, subject to demand”.

The route will give Australian travellers access to United’s San Francisco hub, which connects to major cities throughout North America.

“We can expect to see the trend continue this year, with levels expected to reach a high of 106 per cent of pre-pandemic capacity by mid-year,” the company’s corporate global chief operating officer, Melissa Elf, said.

Travel to the US, however, is frequently at the mercy of the exchange rate. On Monday, the Australian dollar dropped as low as US59.9¢ from US63.8¢ as global markets gagged on President Donald Trump’s decision to impose nearly global tariffs on US trade partners.

Aviation economist Tony Webber said even if fewer Australians can afford to travel to the US, the shortfall will probably be filled with Americans coming to Australia.

The Australian dollar’s fall affects the “mix of travel” between the US and Australia, and whether Americans or Australians are spending more at a given time, Webber said. But shifts in the local dollar don’t usually change the size of the overall “travel pie”, he said.

That’s in contrast with popular destinations such as Phuket or Bali, where some 90 per cent of Australian travel is outbound. When more Australians travel to those places, airlines have the scope to add more capacity to meet demand.

“Those holidays are still very inexpensive relative to a domestic holiday,” he said.

Flight Centre’s Melissa Elf has seen capacity growing to Asia. “Destinations across Asia, like Malaysia and China, and the Middle East, such as Doha, are leading the way with capacity,” she said.

This is also evident in the recently approved deal between Virgin Australia and Qatar, Elf said, adding that the agreement creates 107 connections from Qatar to Europe, the Middle East and Africa.

A Fiji Airways plane at Sydney Airport. The island is hoping to be a crucial connector between Australia and the United States.Credit: Getty

Qatar Airways rival (and Qantas partner) Emirates launched its third daily non-stop service between Melbourne and Dubai, expanding capacity for travel into the hub that serves as a gateway for Australians going to Europe.

Emirates will use newly retrofitted Boeing 777-300ER aircraft, which offer first class, business class, premium economy and economy. It began on March 30.

Fiji Airlines is providing more international capacity for Australians travelling to the South Pacific and the US.

“It’s quickly becoming a favoured stopover destination for North America,” Elf said, adding that the Pacific island nation has reached a pre-pandemic capacity of 134 per cent.

A soon-to-open Cairns to Nadi flight will give Queenslanders access to flights on Fiji’s new Dallas-Fort Worth connection, she said.

A retrofitted Boeing 777 in the Emirates fleet.Credit:

Qantas has launched a Darwin-Singapore service. The new service will operate four times a week, employing Boeing 737-800s. Qantas said the Singapore-Darwin flights “provide a one-stop option to Asia and Europe” for travellers from the Northern Territory.

The route will also simplify travel into Darwin, making it “easier for international travellers ... saving hours of travel time by no longer having to fly through other Australian capital cities”.

The extra capacity precedes an expected rise in long-haul options when Virgin Australia begins to offer flights with Doha-based Qatar Airways.

From June, the airlines will offer flights from Sydney, Brisbane and Perth to global hub Doha on Qatar Airways. In December, Qatar and Virgin will also fly between Melbourne and Doha.

Virgin is pushing ahead with its plans for an IPO. On Monday, it named four executives to its revamped board.

Former Macquarie chairman Peter Warne and former managing director at Goldman Sachs Pippa Downes have been named to the board of Virgin Australia, documents filed by the airline show.

Warne’s appointment stokes speculation he could eventually be named as chair to replace Ryan Cotton.

Qatar’s chief cargo officer Mark Drusch has been named to the Virgin Australia board as a non-executive director, Virgin said.

Bain Capital has also moved across Charles Lawson, the 39-year-old who sits with its Asia Pacific Private Equity team, to the Virgin board. Lawson was promoted to partner at Bain in January.

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