"A Mate" wrote in message
u...
Sheesh!! $29+ still not cheap enough!!

Price competition has proved fatal to smaller operators in Australia
before.
Virgin Blue is now a separate corporate entity; listed on the Austr Stock
exchange. Qantas has the deeper pockets of the two!


Obviously fares at $29 are not sustainable in the longer term, and this is a
promotional gimmick for the introduction of Jetstar services. I'm not
complaining about the fare, far from it, it's great that many people who
otherwise could ill afford to fly are encouraged to do so.

Past start-ups of budget airlines in Australia have been un-successful
because they have had to compete with two majors, TAA/Australian/Qantas and
Ansett, who could match or better their budget fares for a while to make
them financially unviable. The same business tactics were employed on the
international market to drive Sir Freddy Laker's Skytrain out of business.
Now Ansett's gone, there is only one "full-service" domestic operator.
Virgin Blue is now well established with around 30 aircraft, so it won't
flounder like the previous under-capitalised attempts to establish a budget
operation, eg Compass. Qantas has to be careful that in establishing
Jetstar that it doesn't withdraw too much of the market that may swing over
to the low cost operation, a lot of businesses are now looking to cut costs
and if they lose much of the lucrative business travel part of their
operation to Jetstar it will affect their overall profitability.

Regards

David Bennetts