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International air fares have hit rock bottom but there is unlikely to be any further discounting this year, the travel industry has warned. In the past few months, increased competition for customers has forced airlines to slash fares up to 65 per cent. Return fares from Australia to Europe have dipped below $1450, while a return ticket from Sydney to Los Angeles is less than $1000.
However, the cost cutting cannot last and consumers have been advised to book travel now. Justin Montgomery, managing director of Creative Holidays – the world’s largest independent travel wholesaler, said airlines would not be able to sell below-cost seats for much longer. "The airlines will have to say, ‘We can’t afford to keep doing this any longer.’ We are at that stage now," he said.
Fares have been slashed on routes to the US, Asia and Europe. "It is 50 per cent cheaper to fly to the UK this year than it was at the same time last year," Mr Montgomery said. "You can fly to Singapore for less than it costs to get to some Australian ports. Hotels and tour operators are discounting, too, but I really can’t see it lasting much longer."
On Friday Singapore’s Tiger Airways released 30,000 "free" seats on a number of Australian domestic routes including Sydney to Melbourne. The tickets, which are available until tomorrow, include taxes, booking fees and GST, which must be paid online by credit card at the time of booking. Arthur Hoffman, managing director of online travel agent Expedia Asia Pacific, said uncertain economic conditions could lead to further price cuts.
"We have seen a lot of heavy discounting by the airlines over the past few weeks," he said. "Whether that continues depends a lot on the economy. If the economy stabilises, it’s likely that prices will recover … But at the moment the airlines have no choice but to discount in order to stimulate the market." Last week NSW Premier Nathan Rees travelled to the United Arab Emirates to drum up airline business for the state.
source: www.smh.com.au
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