Skift Take

A new direct route will change traveler habits on Australia’s west coast and may deliver more market share to Qantas. But, more importantly, it looks set to herald more ultra-long-distance connections between Australia and Europe.

Editor’s Note: Gateway is a Skift series featuring first-hand, original stories from our correspondents embedded in cities around the world. The logo reflects where the correspondent is based and not necessarily the article’s focus. Read about the series here.

Four months from the first departure, there is already strong support for Qantas’ nonstop flights between Perth and London —  Australia’s first-ever direct link to Europe.

The service begins in March 2018, and already there are indications of good passenger loads in both directions. In fact, Qantas chief executive Alan Joyce hinted demand has exceeded the airline’s expectations, although he wouldn’t release booking figures.

Kelly Weinbauer, Western Australia product leader for Australia’s largest travel group, Flight Centre, noted that “there has been plenty of interest in the new non-stop flight … which was noticeable at our recent World Travel and Cruise Expo”.

Weinbauer said she expects strong demand both outbound and inbound travelers. “Particularly, we expect business class fares to be popular for this non-stop service,” she told Skift.

Currently, Qantas flies to London via Singapore or Dubai, though it will drop Dubai next year when it adds Perth. The new 17-hour service will shave about three hours off the travel time for passengers flying from Perth to London via current routes. Passengers starting in Melbourne still have to make a stop, but they’ll save 90 minutes by making it in Perth.

The Perth-London service became a reality with the recent delivery of Qantas’ latest Boeing 787-9 Dreamliner.

“This is a game-changing route flown by a game-changing aircraft,” Joyce said in a statement. “Australians have never had a direct link to Europe before, so the opportunities this opens up are huge.”

Strong Demand from UK and Australia

A Qantas spokeswoman told Skift the airline is seeing strong interest for the direct Perth to London service from travelers on both ends of the route.

“Perth is perfectly placed for customers traveling to the UK connecting from other parts of Australia and is also a fantastic tourism destination in its own right for people traveling from London,” she said.

The new service has been welcomed by business travelers, with travel management companies reporting strong interest from corporate clients, especially those based on Australia’s west coast.

Demand likely has been stimulated by keen fares, with the direct service priced at or below the one-stop alternatives. Some corporate fares are more than A$500 ($380 U.S.) cheaper on the new service. However, since corporates booking an average of 21 days before travel, the success of the route among business people won’t be known until at least February.

A Niche Route

According to aviation analyst and former Qantas executive Tony Webber, now CEO at Airline Intelligence and Research, the new service may provide a brief stimulus, but it won’t create new demand.

“You would have to argue that demand is a function of the total travel time, and that reducing the travel time by two to three hours will expand the market. It may expand the market but I think it will be trivial,” he explained, adding that a large part of the Perth-London market is travelers visiting friends and relatives, and these travelers are not influenced by travel time.

While the industry will be watching the route closely, Webber said he doesn’t anticipate much direct competition for Qantas. Only Australian and UK airlines can operate this city pair and with British Airways reducing its services to Australia, Virgin Australia would be the only likely contender. But, as Webber explained, “Virgin (Australia) would have to invest in new aircraft and the aircraft would have to have the range to fly the route”.

Looking ahead, the bigger possible impact will be on more services between Australia and other European destinations, overcoming the need for an Asian or Gulf stopover. The airline is no doubt also monitoring the performance of the 787-9 Dreamliner with a view to future services from Perth to other European gateways like Paris, Amsterdam and Frankfurt.

Qantas also is looking to aircraft manufacturers to produce jets capable of London services from its East Coast hubs of Sydney and Melbourne.

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Tags: australia, gateway, qantas

Photo credit: Qantas is bullish on demand for its new Boeing 787-9 nonstop from Perth to London. But the route does not start until March, and since business travelers book late, it'll be some time until the airline has a good idea of premium demand. Qantas

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