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Discussion Starter #1
Can some of our av experts explain - why is the LCC market for Australia reasonably robust, but not the seasonal tourist charter market like Europe?
 

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32 years in the industry
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More countries and cities to visit,each with a different identity and customs and scenery.
Large population
More wholesalers
Wholesalers that own hotels and airlines.(This is the most important factor)
The Late Thomas Cook is a prime example.
Colder climate with nearby sunshine destination offerings such as Teneriffe!
 

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RAWR ROAR RAWR
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im wondering if the small aussie market in terms of pax is the reason?
 

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Hmm... could this be the reason????? 100's of millions of possible customers vs 25 mil????? hmmm??????
Yes this is one of the factors i mentioned ...Larger population.:)
 

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Discussion Starter #7
Yes this is one of the factors i mentioned ...Larger population.:)
Then it should be easy for a large European player to come in and buy up our entire market in one fell swoop.

There must be some deeper reasons than that.

It can't be hard to buy up 2000 rooms of Bali hotels, a couple of 737s and call yourself Aussie Holidays PTYLTD and offer a fully integrated discount product. Instead we have the ultra discounts led by Jetstar QF, Airasia, Scoot and so on.
 

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I am surprised someone like Lion Air or AirAsia isn't doing the all-in-one integrated discount product already (either by buying/building their own accommodation or doing some major deals with existing accommodation providers).
 

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Do Australian consumers even like package holidays in the same way as UK consumers do?

The UK are a country of people that will buy a cookie cutter row house for example.
 

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From living in the UK for a few years, and from having family members and friends come out here to Australia, I'd say that the UK population are much more into fully packaged tours. Maybe it's from a history of things like Butlin's holiday camps, etc. Where everything is done for you. A standard holiday for them would be to book 2 weeks in Tenerife, Cyprus, etc at the travel agent. The one cost would include airfares, hotels, etc. There would be a holiday rep from the company who would lead the group, organise everything for them, sort out any problems, etc.

Whereas Australians have always travelled more independently, book the flights yourself, book a hotel, rock up, sort stuff out yourself, etc. We do have some package stuff, lots of Aussies (including myself 20+ years ago) do the Contiki tour around Europe. But generally we like to run our own trip.

Probably now, with a few big companies like Thomas Cook failing, and the internet making it easier to shop around, more people in the UK are probably doing it all themselves.

The bigger market over there also does make it worthwhile and more likely for companies to try to vertically integrate and run the whole show themselves.
 

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WARREN
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Where everything is done for you. A standard holiday for them would be to book 2 weeks in Tenerife, Cyprus, etc at the travel agent. The one cost would include airfares, hotels, etc. There would be a holiday rep from the company who would lead the group, organise everything for them, sort out any problems, etc.
Sheep are what I call these sort of people. Good on them though, they can soak up all the tourist traps and leave the real fun for the professionals.

I've known a few of these sort of people. They think they're being "smart" in getting an "expert" to do it all for them. There will be always a sizable market of these kind of dummies. Definitely enough of them to fill a couple of planes a day to Bali, London or any other destination on the must-see-for-a-standard-tourist list.

Whereas Australians have always travelled more independently, book the flights yourself
Flight Centre still exists in any shopping centre of any significance so clearly there's enough dummies still around.
 

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There is (or was) definitely a market for a charter travel operator in Australia. Flights from Australia to Bali are basically the equivalent of flights from the UK to the Canaries or Greece. It would be quite profitable indeed to run package operation chartering flights even from airports like Newcastle or Rockhampton to Bali or Fiji.

I remember reading somewhere that the reason this style of operation is not prevalent in Australia is because of the way our civil aviation regulations are worded. Leisure charter travel of the kind you see in Europe would be classed as RPT in Australia, so there isn't really an advantage to the industry to try and charter whole aircraft for a particular tour company.

However, Jetstar has at times taken a mixed-mode approach to this. When they were running flights between Wuhan and Gold Coast, a Chinese tour company was paying for the majority of seats on the aircraft. But as the operation was classed as RPT, Jetstar made the remainder available for sale to the general public. I daresay there is a similar arrangement on the new Seoul-Gold Coast route.

Antarctic flights with Qantas are another example of a whole aircraft leisure charter, but as they depart and take off at the same airport they probably come under a different classification of flight again. Australian regulations are cumbersome!
 

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Discussion Starter #13
There is (or was) definitely a market for a charter travel operator in Australia. Flights from Australia to Bali are basically the equivalent of flights from the UK to the Canaries or Greece. It would be quite profitable indeed to run package operation chartering flights even from airports like Newcastle or Rockhampton to Bali or Fiji.

I remember reading somewhere that the reason this style of operation is not prevalent in Australia is because of the way our civil aviation regulations are worded. Leisure charter travel of the kind you see in Europe would be classed as RPT in Australia, so there isn't really an advantage to the industry to try and charter whole aircraft for a particular tour company.

However, Jetstar has at times taken a mixed-mode approach to this. When they were running flights between Wuhan and Gold Coast, a Chinese tour company was paying for the majority of seats on the aircraft. But as the operation was classed as RPT, Jetstar made the remainder available for sale to the general public. I daresay there is a similar arrangement on the new Seoul-Gold Coast route.

Antarctic flights with Qantas are another example of a whole aircraft leisure charter, but as they depart and take off at the same airport they probably come under a different classification of flight again. Australian regulations are cumbersome!
I suspect we have a winner! Definitely the post I was looking for.

I think some of the European charter operators are able to skirt some of the regulation of both market access and safety that would otherwise affect them if they were RPT.

It does strike me that if I was flogging Bali hotel rooms to people in Newcastle or Sunshine Coast or whatever, why not run charters out of these airports, especially if I can make the FedGov presence there as cheap as possible for Passport/Customs/Quarantine clearance.

For that matter, I could probably also get away with 737 or A320 if I know for certain I will have a full flight and I can pair down the on board accouterments.

Bali itself might be saturated with LCCs, but it would be interesting to open up other destinations this way eg direct Lombok out of Syd/Mel/Bne.
 

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Discussion Starter #14
Sheep are what I call these sort of people. Good on them though, they can soak up all the tourist traps and leave the real fun for the professionals.

I've known a few of these sort of people. They think they're being "smart" in getting an "expert" to do it all for them. There will be always a sizable market of these kind of dummies. Definitely enough of them to fill a couple of planes a day to Bali, London or any other destination on the must-see-for-a-standard-tourist list.


Flight Centre still exists in any shopping centre of any significance so clearly there's enough dummies still around.

Yes I do enjoy a good laugh at people thinking Flight Centre have 'experts' at anything really. Most retail travel agents I find worse than useless, I've usually done more research on what I want than they are ever prepared to do for me, and will try to sell me the easiest, most commission-rich option they can, of course.

The only time I've ever used one in the last 20 years is when something is advertised on the window and I go in and say I want that. Only that. Not being upsold something else.
 

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Discussion Starter #15
I am surprised someone like Lion Air or AirAsia isn't doing the all-in-one integrated discount product already (either by buying/building their own accommodation or doing some major deals with existing accommodation providers).
I would like to seem them 'extend' their product using charters rather than just substituting it.

I recall in the 1980s our family was to go on a conference package to Vienna and the airline selected was SQ. SQ basically said to the conference organisers that if they could get 300 people onto the plane they would charter it direct MEL-VIE with only the fuel stop in Singapore.

Now this was a conference but you can see how straightforward this COULD be with integrated marketing of hotel or tour packages.

Say Malindo says we are flogging Langkawi to Perth people and if we don't get the bums on seats then they will travel RPT, but if we hit a magic 150 we send a 737-800 and fly direct.
 
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