The Australian Competition and Consumer Commission (ACCC) has singled out domestic airline service reliability as a “significant concern”, noting that cancellations and delays remain “persistently high” even as traffic recovery stabilises and airfares decline.
In its quarterly domestic competition report – the first in more than half a year – the commission found that about 5% of domestic flights were cancelled in December 2023, more than double the long-term average.
It also found that less than two-thirds of flights in December arrived on time, far lower than the long-term average of 81.1%.
ACCC chair Gina Cass-Gottlieb says: “The persistently high rates of cancellations and delays compared to long term averages in the second half of last year were clearly disappointing for consumers.”
The watchdog found that a lack of air traffic controllers to have contributed to the poor reliability performance. Airservices Australia, a government agency overseeing air traffic management, said a shortage of manpower was responsible for 6% of flight cancellations and 16% ground delays in December 2023.
Other factors include supply chain disruptions and a shortage of pilots, the ACCC notes.
In its report, the commission found that passenger volume and capacity have largely stabilised after pandemic-driven “fluctuations”.
In December 2023, Australian carriers flew about 4.8 million domestic passengers, or about 94% that of pre-pandemic 2019. Capacity recovered to around 95% of pre-Covid-19 levels.
ACCC’s Cass-Gottlieb adds: “Although passenger levels and capacity have not quite returned to pre-pandemic levels, the industry appears to have largely moved on from its recovery phase and is now exhibiting more typical seasonal trends.”
The commission also found airfares to be tracking downward after record highs in 2022.
According to the ACCC, domestic airfares in December 2023 were about 13.4% lower compared to the year-ago period, when adjusted for inflation. Airfares were also about 1.4% lower than pre-pandemic levels.
“This was consistent with lower jet fuel prices, airlines slightly increasing seat capacity, and an easing of post-pandemic pent-up demand for travel,” the commission states. However, discount economy airfares have not fallen to pre-pandemic levels, notes the ACCC.
The latest report marks a return of the ACCC’s monitoring of the domestic airline sector after more than six months. In November 2023, the Australian treasurer directed the commission to recommence monitoring for the next three years.
