BRISBANE – Virgin Blue boss Brett Godfrey says the Pacific route connecting Australia and the US has gone from being one of the world’s most profitable to a loss-making exercise for airlines over the past year.
But the era of low fares may be coming to an end, he said.
Speaking to the Queensland Media Club, Godfrey said low prices were not sustainable.
"When you can get to the US from Australia for about $1200, when 15 months ago at this time of year you’re were looking at $2800 to $3000, something is wrong.
"Clearly we’d like to see a return sooner rather than later (to pre-recession prices).
"And we will. It’s not that we’ve got too much capacity there. It’s just that the market has fallen off."
Virgin Group’s V Australia was recently given the go-ahead by the Australian Competition and Consumer Commission for a tie-up with the route’s other new player, Delta Air Lines.
Qantas is continuing to have success on its US flights, helped in part by the popularity of its A380 superjumbo service.
The Age said passenger demand for flying on the world’s largest airliner was allowing Qantas to charge up to $600 more than its rival, United Airlines, on return flights to Los Angeles.
