Qantas has started getting rid of the fuel surcharge on tickets as global prices for oil keep falling.
But the airline won’t be passing on savings on tickets. The total cost of fares is not changing.
However, charges for Frequent Flyer redemption bookings will fall by up to $130.
Virgin Australia last week announced it is dropping the fuel surcharge on its flights to the US and rolling the costs into its full fares. The move will result in a saving on tickets of between $40 and $50.
Australian airlines, including Qantas, have been under pressure to remove the surcharge after prices for oil plunged about 50% in the last 12 months.
What Qantas is doing is to gradually restructure its international charges so that fuel surcharges are absorbed into base fares.
Qantas says: “While global fuel prices have fallen in recent months, international air fares are extremely competitive and are significantly lower than when surcharges were first introduced 10 years ago.”
From tomorrow, fuel-related charges to Frequent Flyer on Qantas and Jetstar Classic Award redemption bookings will fall by up to $110 in Economy and up to $130 in Premium Economy on some routes for a return flight.
Reductions will vary across the network but will average about 14%.
Qantas Group CEO, Alan Joyce, says: “If you look at the trends in global aviation over the past decade, costs and competition have been increasing while fares and airline margins have been falling.”
Qantas International has posted significant losses in the past two years.
“In a highly competitive environment where customers are already paying less than they were several years ago, lower oil prices can help put the industry on a more sustainable footing,” Joyce says.
“It means airlines are in a better position to invest in the new aircraft, new lounges and new routes that ultimately benefit customers.”