20 October 2008

Qantas says passenger demand down

A Reuters report this morning says that Qantas CEO Geoff Dixon said in Melbourne that, "There is a lessening in demand in all classes, Qantas has held up better than most airlines," speaking at the launch of its Airbus A380 service to Los Angeles.

Worries about the impact of the global economic slowdown on international travel have hit airline shares in recent weeks, with Qantas shares down 14 percent since the start of October compared with an 11 percent slide for the broader market.

Demand had already been hit by soaring oil prices earlier in the year, which saw airlines raise fares to cover their rising fuel bills, though oil prices have since halved from record highs amid the credit crunch.

The Airbus A380 will begin service from Melbourne to Los Angeles on Monday and will fly the Sydney-Los Angeles route on Friday.

It is configured for 450 passengers including 14 in first class and 72 in business shaped in futuristic silvery-backed pods.

Qantas and other customers have been hit by a two-year delay in deliveries due to problems in wiring the double-decker A380.

The first plane rolled off the assembly line at the end of 2007. Airbus plans to deliver another five this year, including two more to Qantas.

Alan Joyce, head of Qantas subsidiary JetStar, will take over as Qantas chief executive from November.

A Report by The Mole