Australians pay double for flights

One way deals don't add up ... conspiracy theories are abound about why outbound Aussies take it in the neck and in-bound tourists live it up.
One way deals don't add up ... conspiracy theories are abound about why outbound Aussies take it in the neck and in-bound tourists live it up. Photo: AFR

Australians are being charged up to double the price of airfares and cruises than travellers who book the same journeys from overseas.

Australians flying from Sydney to London return over Christmas on Singapore Airlines are being charged $2800. But buying a return ticket from London to Sydney costs only $1800.

And a return flight from Melbourne to Bali over Christmas on Garuda will set you back almost $1800. But buying a return ticket from Bali to Melbourne is almost half the price, at $925.

What you pay depends on where you're coming from on air fares.
What you pay depends on where you're coming from on air fares. 

Things are no better on the cruising front. One Australian couple said they recently paid $8000 for a Mediterranean cruise on the Star Princess that cost their American friends only $4000.

In the infinitely variable world of the pricing of airline flights, conspiracy theories abound about why outbound Aussies take it in the neck and in-bound tourists live it up.

But it is simply a case of economics - and a little gouging - according to an associate professor at the University of Sydney business school and former Qantas economist Tony Webber.

"It's a case of supply and demand," Professor Webber said.

"Airlines price their fares higher the stronger the location of demand.

"Australian outbound travel is very strong at the moment relative to inbound travel, so the airlines will charge Australians a higher price than they charge for those who are buying tickets in a foreign country."

And he said airlines would push the prices up as high as they could, noting the benefit Australians are enjoying from the strong Australian dollar. "[Airlines] are saying, 'We want a bit of that action."'

A Singapore Airlines spokesman attributed variations to supply and demand as well as seasonal variations.

Carnival Australia vice-president of corporate affairs, Peter Taylor, said cruise pricing was subject to geographic differences.

"The cruise business is very competitive and cruise operators naturally want to sail with a full complement of passengers, so it makes sense for pricing and marketing to be attractive and responsive to particular markets.

"This means sometimes prices will be higher and sometimes lower in various geographic areas and on various voyages.

"For instance, there may be a need to introduce a low fare in a prime source market to fill cabins at short notice," he said.

Cruise passenger Peter Schiller wrote to Fairfax Media recently alleging prices for alcohol and other items were jacked up by about 30 per cent when Aussies boarded the Rhapsody of the Seas in Honolulu.

A Royal Caribbean spokesman said last week the price differential in this case could be explained by the fact that compulsory tips and gratuities were added to bills in Alaska, the Caribbean and Europe but in Australia they were included in the bill.

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