It’s a tough gig for any airline trying to fly in and out of Australia these days. That’s because aircraft can only fly in very small numbers of passengers. Loading the plane up on the return flight home is also an issue. Unless you are a VIP or well-connected, Australians are banned from leaving the country.
A handsome market share but too few passengers
For airlines trying to maintain services into Australia, this is a big problem. So much so that many airlines, including Australia’s national carrier, Qantas, have decided that it’s all too hard and suspended their international services in and out of Australia.
But Qatar Airways has kept up flights to four cities in Australia throughout 2020, sending A350s into Sydney, Brisbane, Adelaide, and Perth. That decision has seen Qatar’s market share in Australia soar. Australian Government statistics reveal Qatar Airways flew 27.2% of all passengers in and out of Australia in July 2020. In July 2019, the figure was 3.3%.
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With Qantas declining to operate international services, Qatar Airways has stepped into the vacuum. On face value, it seems like a magnificent opportunity for Qatar Airways. But strict limitations on passenger numbers are hampering airlines trying to make a go of services to Australia.
In July 2020, 73,851 passengers either arrived in or departed from Australia. With a market share of 27.2%, Qatar Airways flew 20,087 of them. In contrast, 7,446,737 passengers either arrived in or left Australia in July 2019.
Multiple services but a low seat utilization rate
If Qatar had operated a limited number of services, say, a single A350 service a day into Australia, then the passenger loads on their flights would be handsome. But Qatar Airways operated 106 flights in and out of Australia in July and had an average seat utilization rate of 23.8%.
At the moment, Qatar Airways sends either A350-900s or A350-1000s into Australia. The A350-900 seats slightly less than 300 passengers, the A350-900 seats somewhat more than 300 passengers. It’s a 14 hour, 12,000 kilometer plus flight from Doha to Sydney. Before everything went awry, Qatar Airways needed to fill about 85% of its seats on its Australia-bound flights, including across its premium cabin seats, before it made a profit.
Now, there are Australian Government limits on the number of passengers who can come into Australia on international flights. Qatar Airways is allowed to bring in just 30 to 40 passengers on its Sydney flights, 25 passengers on its Brisbane flights, 30 odd passengers on its Perth flights, and 60 passengers on its Adelaide flights.
It should be noted the Brisbane service continues onto Auckland, so there are more than 25 passengers onboard the plane.
These limits are imposed so that local health resources and mandatory quarantine facilities do not get overwhelmed.
Qatar losing money on Australian flights but remains committed
The upshot is despite an outstanding market share, Qatar Airways is losing money on its services to Australia. That’s despite sky-high fares and the airline filling its premium cabins over the lower-yielding economy cabin. As a result, it has become an expensive and delayed ordeal to get home for many Australians.
Nonetheless, Qatar Airways says it remains committed to Australia. So much so, it has asked for additional landing rights for when things return to normal. Its services to Brisbane are temporary, but Qatar would like to fly there permanently. In the meantime, Qatar Airways might be losing money, but it seems to be enjoying acting as Australia’s surrogate national airline.