Thursday, March 18, 2010

TU News : Branson forces SA-Oz fare dive

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Branson forces SA-Oz fare dive

Meaningful competition on the South Africa-Australia route has already seen fares tumble 30% as V Australia launched its JNB-MEL service this week.

 
Addressing onlookers at the very first check-in of V Australia passengers in Johannesburg, a jovial Richard Branson explained how 16 years ago he had begged authorities for a licence to operate flights between the UK and South Africa to break the monopoly SAA and British Airways had enjoyed on the route for years. 
 
"With SAA and Qantas acting as one airline there has been no competition on the Australia route but we're here to change this," he said.
 
V Australia ce, Brett Godfrey, highlighted that, as a result, fares to South Africa had been excessive in the past. "Since we announced our intention to fly to Johannesburg, fares have dropped 30% and today they're down an additional 10% as we launch our service. We're full tonight and we're full coming back," he said.
 
As a result of strong forward bookings on the route and pending the arrival of its next B777 aircraft, V Australia is boosting its schedule from two to three return weekly services from December 16. "And we aim to increase this to a daily flight," said Branson.
 
The new service to Johannesburg will mean passengers can, for the first time, fly around the world with one brand. "South African travellers will be able to fly to Australia and then across to Los Angeles on V Australia, on to New York with Virgin America, followed by a flight to London and then back to South Africa on Virgin Atlantic."
 
Currently, Qantas and SAA own almost 70% of the market flying from South Africa to Australia. Recently Australia's International Air Services Commission granted Qantas permission to renew is codeshare with SAA until December 31, provided the two airlines priced and sold their services on the route independently.
 
The airlines will also only be allowed to operate the codeshare if they have at least 10 return services per week.


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