4th Dimension and CAPA partnership delivers new airfare analysis and aviation report


CAPA Australian Aviation Summit - Sydney - 6 August 2014

4th Dimension, Flight Centre Travel Group's new business travel consulting division, has partnered with CAPA - Centre for Aviation, to produce an in-depth report into the Australian aviation industry.

Called the Australian Aviation and Airfare Analysis, the report includes the results of a specialised airfare benchmarking analysis conducted by the team at 4th Dimension.

4th Dimension General Manager Virginia Fitzpatrick said her consulting practice had joined forces with CAPA and leveraged the extensive ticketing data of the Flight Centre Travel Group (FCTG) to produce an airfare analysis that was unrivalled in the Australian travel market.

"Our partnership with CAPA presents an exciting opportunity," Ms Fitzpatrick said.

"During the past few months we have mined the ticketing data from across the retail and corporate divisions of FCTG and collaborated closely with CAPA to produce this report," Virginia said. "This report will provide a definitive guideline for finance, procurement and travel managers as it captures and analyses average ticket price (ATP) patterns and also includes the latest trends and predictions for domestic aviation.

"When you merge the airfare analysis with the aviation data, the market intelligence provides a powerful tool for companies to use for their own benchmarking metrics. This kind of intelligence is critical for companies looking to improve their travel management services, measure their supplier performances and reduce travel costs.

"For individual travellers in the retail or corporate market this report gives an excellent indication of what kind of buying behaviour and 'buying environment', will secure the best deal on air tickets ...which fare types they should be buying, what channels they should be purchasing through, when they should be buying their air tickets and what are the prevailing trends for our major carriers in the market."

Executive Chairman Peter Harbison said CAPA was delighted to be working with 4th Dimension to deliver new insights into and analysis of the Australian aviation and travel markets.

"The report will be the most detailed of its kind and fill a key gap in the market intelligence available on airline pricing and capacity trends,” Mr Harbison said.

"CAPA’s initial research has found that airline capacity growth in FY2015 will be muted, as there are no large fleet additions scheduled as airlines focus on capacity management. There are also signs of a slowdown in premium traffic, reflecting a weaker consumer outlook and economic uncertainty."

Mr Harbison added there were a number of existing and emerging trends in Australia and abroad that could impact airfare pricing.

"The domestic economy is more uncertain as the mining boom slows and State and Federal Governments plan further activity around fiscal consolidation. Looking ahead geopolitical tension could put pressure on jet fuel prices and fleet plans for our major carriers indicate no substantial growth is incoming," he said.

“What is clear, is that a competitive airline market in Australia has been good for business and has given travellers including corporate buyers greater choice. The part that is most vital however is, what’s going to happen next?"

Snapshot of findings from the Australian Aviation and Airfare Analysis report:

- Procurement practices layered into a strong managed travel program are delivering the best domestic average ticket price (ATP) reductions.

- In the corporate travel space, airfare analysis indicates domestic ATPs have fallen consistently quarter on quarter from October 2013 through to June 2014. Some domestic sectors recorded ATP reductions up to 9%.

- When you compare 2014 to 2013 domestic fare data, average ATP reductions of 3% are being reported across retail and corporate fares for all key sectors for Australia's two main carriers.

- During the latter half of 2014, the market is unlikely to see any aggressive carrier discounting or capacity additions.

- Carrier network adjustments will continue and an ongoing shuffle of services between mainline, discount and regional subsidiaries will occur to maximise profit.

- Weak consumer outlook has contributed to Federal Government budget uncertainty, but demand is expected to recover in late 2015. State and Federal Governments have planned fiscal consolidation and growth in public demand remains weak. 

Report background

Part one of the Australian Aviation and Airfare Analysis report will be available via the CAPA website in September 2014.

Part two of the Australian Aviation and Airfare Analysis report will be available February 2015 via the CAPA website. The full report will include a 2014 year-end analysis, specialist airfare benchmarking analysis as well as predictions for the travel market in 2015.

To register your interest in receiving the report please email capa@centreforaviation.com

To download the report in September 2014 visit www.centreforaviation.com

Data sources

A full city-pair benchmark analysis is included in the Australian Aviation and Airfare Analysis report to be published September 2014.

4th Dimension analytics were based on the following:

- Qantas and Virgin Australia sold fares provided by corporate and retail divisions within the Flight Centre Travel Group.

- Key city-pairs used in analysis SYD-ADL, BNE-MEL, SYD-BNE, SYD-MEL, PER-MEL.

For more information please contact:

Flight Centre Travel Group                                                                  CAPA Centre for Aviation

4th Dimension                                                                                 Derek Sadubin

Sally Gordon                                                                                      Ph: 0404 816 747             

Ph: 0412 492 433                                                                               Em: ds@centreforaviation.com

Em: sally_gordon@flightcentre.com                        


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