QANTAS: Fares will rise by 3.5% from 27 October
In a note to travel agents, Qantas has advised that its fares will rise by an average of 3.5%, with Jetstar fares up an average of 3% from next week. Specifically, 27 October, 2023.
The major drivers for the fare hike are the increasing cost of oil due to tensions in the Middle East, moving the crude price closer to US$ 100 (AU$ 158) a barrel. A weakened Australian dollar hasn’t helped either
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Back on 28 September, Qantas advised that it would absorb current increases in fuel price, which at that stage were around 30%. But, if the cost of fuel went higher, it would need to adjust fares. Chickens are apparently coming home to roost.
There is likely to be some passenger resistance to these fare hikes due to other cost of living pressures. Qantas fares are already high, and some interpreted the advice back in September to mean that a return to lower fares would be delayed rather than fares actually increasing.
It’s expected that the increased fuel prices will add about AU$250 million to the forecast given by Qantas back in August. AU$50 million of that is down to the poorly performing Australian dollar. The rest is increased crude prices.
The Qantas share price has received a battering recently. In the last 12 months, it has lost 20% of its value, and today sat at AU$4.72 – a one-year low.
My suggestion is that if you know your travel dates, and are tied to Qantas – book before next Friday. Alternatively, take your chances on sales promotions, or the almost mythical pre-Christmas double status credits offer!
Alternately, book a cheaper airline.
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