Few industries are as heavily impacted by the coronavirus as aviation. With borders closed, various ‘stay at home’ orders in place, uncertainty around when most travel will resume – and of course, many households having less money available to spend on luxuries like flying, in any case – 2020 isn’t a great time to be running an airline.
But despite these challenges, Qantas Group CEO Alan Joyce is optimistic that the airline, and travel more broadly, will recover.
“If this period of isolation has taught us nothing else, it’s how much we value seeing people and places: and that’s why aviation will remain so important,” Joyce shared via LinkedIn.
“A recent survey of our Frequent Flyers showed around 85 per cent are keen to travel again once they’re able to,” he added: a strong statistic, given that Qantas Frequent Flyer has approximately 13.2 million members, or more than half the population of Australia.
Even so, to help demand bounce back – and keep its passengers not only flying, but flying with Qantas – the airline is granting a year-long status extension for those whose frequent flyer tier would have otherwise lapsed between March 2020 and February 2021.
Members of the Qantas Club airport lounge program are seeing those memberships extended by six months: recognising that even for those who continue to fly, all airport lounges remain closed across the country by government order, which extends more broadly to sit-down venues like cafes, bars and restaurants, except for take-away.
The impact of coronavirus on airfares
Some have widely speculated that the coronavirus will place pressure on affordable airfares even after the situation subsides, particularly as airlines look to recover losses and rebuild their balance sheets after the seismic shock of the virus has finished leaving its mark.
However, Joyce sees the situation differently, being mindful not to send airfares skywards, which would further deter would-be travellers from flying after restrictions are lifted.
“There will be lots of low fares,” Joyce confirms. “Airlines will be keen to stimulate travel demand to get their people and aircraft back to work and restart their cashflow pipelines, repairing the damage done by the devastating and sudden drop in revenue.”
“That’s good news for consumers because it means plenty of good deals.”
Competition in Australian skies
More broadly, airline competition in Australia also helps to keep airfares at more affordable prices, but with Qantas’ arch rival Virgin Australia now up for sale, the shape of our future aviation industry is yet to be determined.
Joyce believes that regardless of the outcome of that administration process, aviation in Australia will remain competitive.
“The Australian domestic market has huge potential. And for that reason, this is never going to be a one airline town – or it wouldn’t be one for long,” he says. “Stiff competition has made Qantas better over the years and we don’t want that to stop now.”
One of the best examples of the benefits of competition saw Qantas and Virgin Australia battle for business and corporate travellers on the country's busy east-west routes, with the resulting 'transcontinental turf war' completely transforming the premium travel experience in just a handful of years.
Competition can also be thanked for the opening of the Qantas Premium Lounge Entry facility at Brisbane’s domestic airport, being a private check-in and security screening space for lounge-eligible travellers, as opened years after Virgin Australia first debuted its own similar Premium Entry service in Sydney, and later, Brisbane.
In any case, Joyce sees domestic travel re-opening well before Australians are jetting off overseas, even if the proposed trans-Tasman travel bubble between Australia and New Zealand eventuates.
“We have to be careful not to take the brakes off too early,” he suggests, but when domestic travel restrictions are lifted, it’ll be “great news for our local tourism industry, with more people holidaying in Australia to start with.”