Australian airline Qantas continues to eye the business case for Project Sunrise. But while the airline remains keen on the ultra-long-range flights, there is an emerging body of research suggesting the Project Sunrise target market will take a long time, if ever, to rebound to pre-pandemic levels.
Qantas maintains long term business case for Project Sunrise is strong
Project Sunrise is an ambitious plan to fly from Australia’s east coast capital cities to far-flung destinations like New York and London in a single hop. Qantas is eyeing ordering a clutch of modified Airbus A350-1000 aircraft to operate the flights.
Skipping the traditional hubbing most long-haul flying to and from Australia now involves, these flights would target time-sensitive business travelers and those keen to avoid hubbing. Naturally, hopping onboard a Project Sunrise flight would see travelers charged a premium on a fare that say, otherwise involves a connection through Singapore.
“Our research says customer (preference for) point to point travel is stronger than ever, which means the business case for Project Sunrise is strengthened,” said Qantas Chief Customer Officer Stephanie Tully at a Tourism Australia event last week.
“We want to pursue it. We need to do it at the right time when we have clarity on the recovery of our business, particularly internationally.”
Stay informed: Sign up for our daily and weekly aviation news digests.
Changing market forces could impact Project Sunrise
The CCO’s comments back up what her boss is saying. Qantas CEO Alan Joyce is a strong supporter of Project Sunrise. After delays due to COVID-19 and the subsequent global travel downturn, Mr Joyce has indicated Qantas will revisit Project Sunrise sometime in the first half of 2022.
But Project Sunrise faces challenges beyond borders reopening and international travel rebounding. Top-heavy with premium seats, Project Sunrise is destined to appeal to the business travel market who, until the travel downturn, typically paid a premium on fares for convenience, speed, and flexibility.
However, according to the global consultancy group Deloitte, COVID-19 has permanently reshaped business travel. In an August research paper, Return to a World Transformed, competition and growth needs will see business travel return, but it may take a generation to return to 2019 levels, if at all.
“Travel remains critical to many businesses’ growth. But there has been a realignment and reevaluation of the cost-benefit equations around face-to-face meetings and events,” the report notes.
Overall, Deloitte argues fewer business trips will take place in the future. In addition to a fresh focus on bottom-line savings and environmental sustainability, the rise of remote working is here to stay. Some airline executives, like United’s Scott Kirby, argue remote working may help drive business travel because those workers will need to travel to the office now and then.
Stagnation in business travel could undercut Project Sunrise
But the Deloitte research disagrees. While there will always be a place for some business travel, beancounters have discovered Zoom and Teams is a perfectly functional way to run many meetings and presentations – something many remotely based business travelers used to fly in for.
While the desire to bypass traditional hubs boosts the case for Project Sunrise, will that desire translate into behavior? With Project Sunrise flights charged at a premium, in a new cost-conscious era, many businesses may vote with their wallets and continue to let their employees layover in Singapore for two hours.
Posing an even greater threat is the long-term stagnation in business travel Deloitte predicts. Ultimately, Project Sunrise is contingent on a buoyant business travel market. But the Deloitte research suggests the business travel market is forever changed. There will be fewer trips -particularly long-haul international business trips. Those trips will also have to be justified on an economic and environmental basis.
Despite the Project Sunrise boosterism coming from Qantas, the business case for it may be bust.
What do you think? Will Project Sunrise get off the ground? If so, will it succeed? Post a comment and let us know.