Major airlines are reducing services and increased airfares are next, says one expert.
Airfares are about to rise, says one expert, with the increasing price of oil forcing airlines to reduce services to Australia in order to recoup costs.
For the first time in 14 years, the number of seats sold on planes has dropped – the first time summer capacity has dropped since 2005, according to The Age.
The fallout of these reduced runs means higher fares are on the horizon, says Airline Intelligence and Research consultant Tony Webber.
“[The airlines are] being more rational now, which is really good news for Qantas and Virgin,” said Mr Webber.
Airline bosses agree that the rising cost of jet fuel will lead to higher airfares.
“Oil is our second-largest expense. So when it increases, the cost of air travel increases,” American Airlines chief executive officer Doug Parker said at last year’s International Air Transport Association annual meeting in Sydney.
“I would expect you would see higher fares to consumers over time.”
Would you be likely to plan a holiday before airfares become more expensive?
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