Ex-Qantas boss reveals plans for Aussie Ryanair
A proposed new low budget airline would bring ticket prices down across Australiaâs busiest aviation routes, but faces immense challenges from existing players, experts say.
Former Qantas executive, Peter Kelly is hoping to bring to bear his decades of experience to turn planned new airline, Zinc into a much cheaper alternative for passengers.
Modelled on British ultra low budget carrier Ryanair, Zinc is proposing to offer the cheapest domestic tickets, initially between the âGolden Triangleâ of Sydney, Melbourne and Brisbane, and later adding Adelaide and the Gold Coast.
Despite the inevitable challenges, Kelly says the new Western Sydney International Airport presents the opportunity for a high enough volume of flights to be viable.
The Australian domestic market was previously impeded by a limited number of âslotsâ available for flights through Sydneyâs existing Kingsford Smith Airport, which he said were largely taken up by the incumbent airlines, he explained.
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Professor Rico Merkert, an aviation industry expert from Sydney University, said an ultra-low budget airline like Zinc has the potential to bring ticket prices down across the board.
âFor customers it would be great. More competition means lower prices,â Merkert said.
However, he said low-budget subsidiary of Kellyâs former employer, Jetstar, would push back against another competitor in the market, particularly in its most profitable routes.
âThey will do everything they can to make this a failure in my view,â he said.
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Now defunct airline, Rex also chose to âpoke the bearâ by expanding from its regional roots to offering flights in the âGolden Triangleâ and ultimately collapsed, Merkert pointed out.
However, Kelly said there was an appetite for more competition in Australia, not least by the Australian Competition and Consumer Commission.
âI donât think (Qantas chief executive) Vanessa Hudson wants to see Qantas up on the front page of the newspapers with the ACCC filing (against) them for predatory practices,â he said.
Merkert also questioned the timing of the announcement to kick off a new airline, coinciding with a global fuel crisis, and just last week American ultra low cost airline, Spirit, going bust.
âItâs an absolute crazy environment to set up an airline right now, when most other airlines are just trying to understand how they can survive,â he said.
RMIT aviation expert, Chrystal Zhang, agrees timing is critical for new airlines, saying potentially Zincâs lead-up prior to its launch could make for better conditions in the future.
âNew airlines entering the market would face significant and very head on competition from the incumbent airlines,â she said.
âIn theory, we need more airlines but in reality, perhaps itâs a different story.â
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