23 August ACCC report underscores need for urgent aviation reforms August 23, 2024 By Amanda Rixon Media Release 0 The ACCC’s latest report on Domestic Airline Competition in Australia reveals a significant impact of competition on airfare prices. Specifically, when Rex commenced operations on several intercity routes in 2021, the average fare per passenger on these routes decreased by approximately 25%. This clear correlation between competition and lower airfares highlights the importance of maintaining competitive dynamics within the domestic aviation market. However, the recent collapse of Bonza and Rex’s subsequent withdrawal from intercity routes pose a concerning challenge. With no route now having more than two competing airline groups, the ACCC’s report confirms that this reduction in competition could lead to reduced choice as well as higher airfares, as lower prices are typically seen where multiple airlines compete on the same route. The report also shows that since February 2023, routes with increased competition have consistently shown lower average revenue per passenger compared to the broader domestic network. This trend, driven by Rex’s expansion into major city routes, reinforces the importance of competition in keeping airfares affordable for Australian travellers on both major city and regional routes. The ACCC also noted that a reformed slot scheme at Sydney Airport could have provided some assistance in strengthening competition, although this would only address part of the broader issue. Quotes attributable to ATIA CEO Dean Long (available for interview): “The ACCC’s ongoing monitoring of the domestic aviation industry provides timely and independent insights into aviation competition in Australia. This is a key reason why ATIA advocated for the return of these reports.” “The ACCC’s most recent report reinforces that Australia needs ongoing improvements to the way competition works in aviation, and ATIA continues to call for reforms to deliver better outcomes for travelling Australians and the many travel businesses that support them.” Related Articles Success on ATIA’s call for return of ACCC monitoring of domestic airlines The reinstatement of the Australian Competition and Consumer Commission (ACCC)’s monitoring of domestic airlines is great news for travellers and travel businesses and will support increased efficiency and reliability of flights. Federal Govt reforms to Sydney Airport slot management The Australian Travel Industry Association (ATIA) welcomes the Federal Government’s announcement today on reforms to Sydney Airport slot management as a positive step towards strengthening aviation competition. ATIA tells Senate inquiry a revolution is needed With international fares from Sydney in 2023 up to 99% higher than pre-COVID, and a lack of competition and capacity, the Australian Travel Industry Association (ATIA) has told the Senate Committee Inquiry into Bilateral Air Service Agreements a revolution rather than a recalibration of Australia’s aviation industry is needed to ensure consumers are better supported. ATIA’s major wins in Aviation White Paper Nine months of tireless advocacy has paid off with the Australian Travel Industry Association (ATIA) securing several significant wins in the Federal Government’s Aviation White Paper. ATIA’s asks reflected in main Senate Inquiry Report Many of the Australian Travel Industry Association (ATIA)’s recommendations to the Senate Select Committee’s Inquiry into Commonwealth Bilateral Air Service Agreements on how Australia’s aviation industry can be reformed to better support consumers have been accepted. ATIA Welcomes Federal Government’s Reforms to Sydney Airport Slot Management The Australian Travel Industry Association (ATIA) strongly supports the significant reforms to the slot management system at Sydney Airport as the first step towards making flying fairer. Showing 0 Comment