Major change coming to Qantas in Australia as Alan Joyce promises to bring down airfares

Qantas is about to spend $100million on new and refurbished airport lounges as airfares continue to rise across the industry as it recovers from the global Covid shutdown.   

CEO Alan Joyce insisted the national carrier doesn’t have a bad public image, despite recently falling from ninth to 40 in Australia’s ‘most trusted’ company rankings.

Mr Joyce, who will announce a half-year profit of around $1.3billion for Qantas on Thursday, said airfares were on average 20 per cent higher now than before the Covid-19 pandemic, largely because fuel was 65 per cent more expensive. 

Over Christmas, return economy airfares from Australia to Europe were up to $6,000.

Mr Joyce said international fares would come down as the world moved on from Covid-19 and Qantas faced more competition from overseas airlines.

Qantas is about to spend $100million on new and refurbished airport lounges but said it is not to blame for sky high airfares – ‘the market’ is. Qantas CEO Alan Joyce is pictured

‘We don’t define the prices, the market does,’ Mr Joyce told The Australian, indicating that fares would only come down once foreign airlines added more flights to Australia.

He did not say when that would happen, but in an interview with The Irish Times in June 2021 he said: ‘We don’t think we’ll get back to 2019 levels until 2024.’

Mr Joyce said there are still good deals to be had depending on how far ahead a flight was booked and on what day of the week it was for.

He said Qantas has two million seats available for under $200 this year, while its no-frills subsidiary Jetstar has 10 million seats available for under $100.

There are also five million seats available for frequent flyers to use their points on, he said.

‘My advice is to book early. The second thing is to travel on a Tuesday, Wednesday or Thursday, and the third thing I’d recommend is to wait for the sales to come up.’

Despite dropping 31 places to 40 in pollster Roy Morgan’s ranking of Australia’s ‘most trusted’ companies, Mr Joyce said Qantas will soon be back in the top 10.

Part of the plan to regain the public’s trust is a three-year, $100million investment in lounges, which about 30 per cent of Qantas passengers use. 

Travellers ranked lounges as the third best reason to fly with Qantas, after its huge amount of destinations and its onboard service.

‘What we find over time is that more and more frequent flyers qualify for (lounge access), because we have nine million customers using them each year, so we have to make them bigger and have more of them,’ Mr Joyce said.

About 30 per cent of Qantas passengers use the company’s lounges at airports, such as the one pictured in Perth

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Qantas has two million seats available for under $200 in 2023, while its no-frills subsidiary Jetstar has 10 million seats available for under $100, according to Alan Joyce (pictured)

A new first class lounge is planned for London’s Heathrow Airport to open in time for the first non-stop Sydney-London flights in late 2025.

Lounges at Sydney and Melbourne’s international airports and Hong Kong will be refurbished and Hobart will get a new Qantas club.

In Western Australia, Broome is expected to get an upgraded lounge due to its increasing popularity as a high end holiday destination.

With a massive number of flights having to be cancelled during various Covid lockdowns, Qantas issued flight credits but has been criticised for how hard it is to use those credits.  

Mr Joyce rejected the criticism, though, saying Qantas is ‘sending out emails every month to remind people to use their travel credits and just before Christmas we did a double points offer if you used your credit’.

The Australian Competition and Consumer Commission (ACCC) is, however, continuing to investigate Qantas’ handling of travel credits.

Last year, ACCC chair Gina Cass-Gottlieb said Qantas ‘did not properly make a realistic assessment of how many flights they could serve’ as air travel grew strongly after the pandemic.

‘We are investigating a number of complaints currently, so we have an ongoing engagement, if I put it that way, because our investigations are confidential till we’ve reached a point of conclusion on them,’ she told Guardian Australia.

Hundreds of millions of dollars worth of travel credits remain unspent, but Mr Joyce said the airline was going to great lengths to help people use them.

Along with a dedicated ‘travel credits concierge’ in call centres, Qantas was working on a ‘find my travel credits’ website, similar to ‘find my super’ sites.

Qantas CEO Alan Joyce said there are good fare deals to be had depending on how far ahead a flight was booked and on what day of the week it was for. Pictured is Qantas signage at Brisbane Domestic Airport on Thursday, September 22, 2022

The CEO also said he is concerned that the industrial relations environment has moved too far in favour of the unions under the federal Labor government. 

‘The pendulum swings from one side to the other. When there was WorkChoices (under John Howard’s Liberal-National Coalition), the employers had a massive advantage, now with multi-employer bargaining it gives the unions a massive advantage,’ he said.

‘We’d like a stable system somewhere in the middle that encourages people to negotiate in good faith.’