20 August 2009

Tiger hits back in Sydney-Melbourne stoush

SYDNEY Ã¢â¬' Qantas is beefing up its Jetstar operation in a bid to put more heat on rival Tiger Airways in Australia.

Jetstar will fly in tandem with Qantas full service Cityflyers on the Melbourne-Sydney route to counter TigerÃ¢â¬â¢s move to more frequency on the most precious of Qantas domestic routes.

But Tiger Airways hit back today by putting put 30,000 seats on sale between Melbourne and Sydney, with fares from $25 for mid-week travel between October 4 and March 27 next year.

Ã¢â¬ÅâœFrom October, weÃ¢â¬â¢re more than doubling the number of low fare flights between Melbourne and Sydney (from four daily return flights to nine) so not only is it affordable but we also have even more convenient flight times,Ã¢â¬~ said Steve Burns, Tiger Airways Australia commercial director.

Qantas is also leasing four additional A330 jets to allow Jetstar to grow its international reach further pending the delayed delivery of Boeing 787s.

Qantas reported an after-tax profit $123 million for FY09, down 87.3 percent on the previous yearÃ¢â¬â¢s profit result of $970 million. Sales for the same period dropped 6.9 percent to $14.55 billion.

"There has never been a more volatile and challenging time for the world's aviation industry," Qantas chief executive Alan Joyce said.

Airline analyst Saj Ahmad of Gerson Lehrman said the airline "still has lots of work to do" to turn around its fortunes.

"As with other airlines in the region, Qantas has been hit with a big decline in premium customers and this means that it too will have little choice but to re-evaluate its business model if it aims to stay competitive and profitable," he added.