Qantas and Jetstar reduced their fuel surcharges this afternoon but most Christmas holiday travellers will miss out on the long overdue savings.

This is because the reductions only apply to tickets issued from tomorrow, 23 December. Most holiday period tickets have already been bought.

On domestic routes the Qantas surcharge which was $21 per sector falls only $3 to $18.

But Jetstar’s domestic surcharge which was $19 (in line with Virgin Blue’s surcharge) drops $10 to $9.

On Trans Tasman routes Jetstar is cutting the $45 surcharge by $20 to $25.

This sees Virgin Blue and Pacific Blue flights go from already having a $10 advantage over Jetstar on New Zealand flights where they imposed a $35 surcharge to being at a $10 competitive disadvantage from tomorrow.

However that situation may only last as long as it takes Virgin Blue to announce its moves. A Virgin Blue spokesman said there would be an announcement within a few days. The only place left for Virgin Blue to go to retrieve the high ground would be to completely abolish fuel surcharges but the spokesman said nothing that would encourage such speculation.

Qantas has also been more like Scrooge than Father Christmas in terms of longer haul fuel surcharge reductions.

Its trans Tasman fuel surcharge falls only $10, to $55, or $30 more than the new extra charge on Jetstar fares on the same routes. Qantas and Jetstar are burning the same kerosene, but obviously drawing different conclusions about the price insensitivity of a Qantas customer compared to the knock-you-over-to-pick up-a-dropped-20 cent piece stereotype that Qantas applies to Jetstar customers.

On US routes Qantas customers only get a $20 per sector saving which reduces fuel surcharges to Los Angeles or San Francisco to $130. On flights to London or Frankfurt the saving is only $30, down to $160 each way. $30 is what it costs just to get into a taxi in London!

Qantas says it now estimates its extra fuel bill in the current financial year will be $400 million compared to guidance of $750 million in additional fuel costs given on 27 November. Given that new CEO Alan Joyce is on the public record as saying each $US 1 fall in the fuel benchmark price equals savings of $50 million in $A over a year the plunge in oil to low $US 30s should have eliminated the additional costs completely.

But of course Qantas is including the fuel costs it incurred for the few months of the current financial year when oil was in the $115-145 price range, only to collapse after the global financial crisis took hold in earnest late in September.

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