Finance Finance News Selling fast: Most of the half-price airfares are already gone
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Selling fast: Most of the half-price airfares are already gone

airfares
The government is considering whether to expand its discounted airfare package. Photo: TND
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Australians sure do love a bargain – just look at the government’s half-priced airfares, most of which sold out within a week of going on sale.

Deputy Prime Minister Michael McCormack is now considering whether to increase the number of cut-price tickets on offer after airlines burned through most of the 800,000 fares initially allocated.

At the current rate, the entire allocation will be sold out within a few weeks, five months before the sales period is due to end.

This is despite the government promising in March the scheme would be “demand driven”.

Airlines are already looking to cash in on the mounting scarcity, warning customers the fares – which are only one-way tickets – are selling out fast.

Qantas, which also owns Jetstar, said as much in an email to consumers on Thursday after selling 150,000 discounted tickets in just 24 hours last week.

The national carrier has not revealed how many discounted tickets it was allocated by the federal government, but it is expected to have received the most because it is the largest player in the market.

Virgin, which was allocated 260,000 discounted tickets, had sold about 140,000 by Monday – or 53 per cent of its allocation within a week.

“Virgin Australia has received an overwhelming response for half-price fares,” a spokesperson said in an email to The New Daily.

“We encourage anyone thinking about snapping up these bargain flights to get in quick before they sell out.”

Rex would not say how many tickets it had been allocated or reveal how many had been sold, but said the discounted fares were “very popular”.

“We have seen strong uptake on three domestic routes – Melbourne to Gold Coast, Sydney to Gold Coast, and Melbourne to Adelaide,” a Rex spokesperson told The New Daily.

The Gold Coast has emerged as the most popular destination so far, with Queensland accounting for the lion’s share of inbound tourism from Sydney and Melbourne.

Virgin said more than half the fares it had sold were for travel in June or later, a sign that holiday makers are planning well in advance.

The government has not committed to increasing the ticket allocations, but assured airlines in March the 800,000 was a “minimum”.

The cut-price tickets were first announced in a $1.2 billion package to support the aviation sector and tourism-reliant regions after the removal of JobKeeper.

The government has promised to reimburse airlines for the tickets on a weekly basis, meaning taxpayers are likely to pay hundreds of millions of dollars to the major airlines in coming days.

A spokesperson for Mr McCormack said the tickets would be available “across the travel period” of the program.

“The government will continue to review the program periodically, as it has done with all pandemic response measures, to ensure the program continues to best serve the economy,” the spokesperson said.

In grant guidelines released to airlines in late March, the government promised to consider providing more money to airlines if they chewed through their ticket allocations early.

“The department will consider a variation in the grant agreement to increase the maximum grant amount subject to there being funding available within the maximum program allocation,” it said.

Many customers have been using more than one subsidised airfare per holiday, as each discounted ticket is only one way.

That means although the government has allocated 800,000 discounted fares, far fewer trips will actually be taken to tourism hotspots.

The airlines are also deciding how the tickets are sold – not the government – including which dates are offered for each destination within the travel period.

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