Qantas to lower fuel surcharge for fares

27 Jan 2015 by Clement Huang

A day after Air Asia announced that it will abolish fuel surcharges completely from fares (see here), Australia’s Qantas Airways has revealed that it will reduce its own surcharges effective from January 28.

The reduced charges will apply to Qantas Frequent Flyer redemption bookings only, meaning that members who use their points to redeem for fares will see their imposed additional fees lowered by up to A$130 (US$102).

Meanwhile, the price of standard fares will not change as any reductions will not be visible as historically fares are inclusive of all surcharges.

From January 28 onwards, fuel-related charges that apply to Qantas Frequent Flyer and Jetstar Classic Award redemption bookings will fall by up to A$110 (US$87) for economy and A$130 (US$102) in premium economy for return flights on select routes. Overall, while reductions will vary across the airline’s network, additional costs have fallen around an average of 14 per cent.

Accrual as well as redemption rates will not change, meaning that the price slash will be beneficial for Qantas Frequent Flyer members.

“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,” said Qantas Group chief executive, Alan Joyce.

“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. It means airlines are in a better position to invest in the new aircraft, new lounges and new routes that ultimately benefit customers”.

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Clement Huang

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