International airlines may be the future of Australian air travel, not Qantas

International airlines may be the future of Australian air travel, not Qantas

After Qantas CEO Alan Joyce made the controversial decision to lockout staff and ground all of the fleet, there have been many articles written in The Conversation as well as around the world on the right and wrong of this action.

The debate has brought up issues such as the current Australian industrial relations laws, non-action by politicians, consumer demand and response, brand loyalty, and reputation damage.

At this point, the focus is on the short to medium term future of these issues as well as the question of Qantas’s next steps.

Andrew Hughes, writing in The Conversation, suggests that, while many of us will not wish to fly Qantas again, the majority of us “will do so out of necessity, not desire”.

Hughes’ choice that will lead most of us back to the place we don’t want to go is to swap to Virgin Australia, within what he calls a “duopoly.”

He mentions Jetstar as “Qantas lite” but does not include Tiger or any other regional players, such as strategic.

Qantas, which currently holds a monopoly on Alice Springs and other destinations, means that these options aren’t available to many Australian travellers. For international travelers, however, there are a variety of options.

Voting with credit cards is a popular option for international flyers.

It has been noted that Australians have long voted for their favorite airlines with their credit card. This is what built the long-haul market for Emirates, Etihad, and other competitors who were not present in Australia a decade ago.

Qantas’ future may be a bleak one if we consider the trends in other parts of the world and the players that are not yet in the picture.

The travel habits of Europeans have dramatically changed in the past few decades. The growth of air travel is exponential, but old national carriers like Qantas are not the main beneficiaries.

Low-cost airlines dominate

Ryanair, Easyjet, and Air Berlin are among the newcomers that have dominated the growth of air travel. The overall travel options are now more diverse, with Eurostar and high-speed rail connections being added.

Low-cost European Airline, Ryanair. MAP

This high-speed rail has been the standard in Japan for many decades, and it has just recently made its debut in China, though with unfavorable early results.

Low-cost airline travel is often perceived as a low-budget option. Ryanair’s efforts to lower the quality of flying have been widely reported. This includes charging for holding baggage, using the check-in desks, and for allegedly using the onboard restrooms.

Transfer of short-haul business trips

There has been a significant transfer of business travel for short distances to these airlines. Easyjet’s business clients are substantial, despite the impressions given in Airline, a “reality” television program.

It is possible to imagine very different patterns of travel in Australia ten years from now.

It may have been years since the fast rail link from Melbourne to Sydney, Canberra, and Brisbane was discussed. But it has now become a farce because every council agreed to its passage on the condition that there be a local station.

If aviation fuel prices continue to rise, airport security is tightened, and traffic outside of the central business districts in expanding cities increases, investing in fast rail becomes more appealing.

The investment must be both financial and political. These ideas seem impossible, but they are not implausible.

Qantas CEO Alan Joyce during a Senate hearing. MAP

Qantas must be viewed in light of some key uncertainties, even if we ignore fast rail development over the next decade. The Airline is currently waiting for the very late delivery of its much-needed fleet upgrade. The Boeing Dreamliner fleet is showing its age, and the 767 fleet has been years behind schedule.

While Qantas awaits the arrival of new technologies, other airlines may be already in a position where they can look for opportunities.

Internationals are ready to jump into the fray.

Emirates was among the airlines that were reported to be ready to enter the market during the recent disruption. Why would competitors ignore the opportunity to join the Sydney-Melbourne market, which is one of the most popular routes in the world?

They may not have the Qantas infrastructure of lounges or terminals, but these factors aren’t necessary to bind customers to the Qantas brand. Why would businesses continue to question their cost base and the global economic crisis if they are not able to offer these extras?

IT experts predicted the end of business travel by air, as video-conferencing and the paperless office would replace it. These visions are science fiction, but they’re not impossible.

The current economic, environmental, and social uncertainties in this world and country point to an uncertain and unpredictable future for air travel, both domestically and internationally.

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