THE post-Christmas airfare wars moved into full swing yesterday as Virgin Blue hinted it might expand its $5 one-way internet fare offer to other capital cities and Qantas announced it was releasing 2.5 million cheap summer seats.
Qantas will not match the $5 Virgin fares, but released a cheap fares to 60 destinations starting as low as $66 one-way for an internet fare on east coast trunk routes.
Qantas executive general manager sales and marketing John Borghetti said the cheap seats, available for travel between January 9 and March 27, were designed to stimulate demand in the traditionally slow new-year travel period.
Mr Borghetti said the market appeared to be softer than at the same time last year, with November figures down 5 to 7 per cent.
“Having said that, the January-February market is always pretty quiet until the business market picks up again,” he said.
Virgin Blue yesterday reported a strong response for its ultra-low promotional fares for travel from Melbourne to Adelaide, Sydney, Canberra, Brisbane and Launceston.
About 10,000 $5 seats have been made available on off-peak flights from January 9 to March 27. It will not be matched by Qantas.
Virgin had a strong surge on its website, as news filtered out yesterday, and had sold about 4000 by early afternoon. It expects the seats to be sold out well before the December 31 deadline.
While the low fares are only available for flights out of Melbourne, they can be used in conjunction with Virgin`s “Blue Year” sale, which offers one-way fares over the same travel period from $69.
This means Victorian travellers and those flying to Melbourne can get return fares as low as $74 if they are prepared to fly at unpopular times.
Virgin officials say the fares are not primarily aimed at the fledgling Ansett Mark II, although they admit they could be read as a response to recent statements by Lindsay Fox that he would put Virgin out of business.
Virgin Blue head of commercial David Huttner said the promotional fares were designed to stimulate travel and to let people know cheap seats were again available after availability problems caused by last September`s collapse of Ansett.
“We`re just saying to people: life`s back to normal, there are lots of seats out there, there are lots of seats at low fares, get out there and travel,” Mr Huttner said.
He would not comment on Virgin`s future fare plans but did not rule out introducing the $5 internet specials in other markets.
He said Melbourne was one of the markets where Virgin had added significant capacity in the past four months to cater for business travellers.
“You up capacity dramatically in a market and you end up with a lot of empty seats at midday,” he said.
Ansett is offering fares on east coast trunk routes after January 31 from $154 return for a 21-day advance ticket.
Asked whether the fare sales would make life harder for Ansett, Mr Borghetti said: “I think they`ve got a hard road ahead of them regardless. I don`t think this is going to make any difference. I think it`s a very difficult market.”