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Aviation report

The outcome of 4th Dimension’s (4D) airfare analysis of domestic and international airfares delivers critical information for Australian universities looking to contain costs, according to 4D General Manager Felicity Burke.

The study was included in the Australian Aviation and Airfare Analysis, produced by 4D, which is Flight Centre Travel Group's (FCTG) business travel consulting division. The report includes a benchmarking study that compares the price of corporate and leisure airfares purchased through the FCTG network in 2016 compared to airfares purchased in 2015 and 2014. 

The study indicates domestic Economy Class tickets, purchased through FCTG’s corporate travel brands, have dropped by as much as 7% on the top domestic routes and by an average of 10% for tickets purchased through FCTG’s retail travel brands.

Mrs Burke said the fare analysis and benchmarking of both corporate and leisure tickets was more important for universities than any other travel sector due to the unique nature of the university travel environment.

“A university as a whole has a huge travel volume, which consists of both business travel and leisure travel.  A university corporate travel program is reflective of corporate discounts from industry suppliers plus leisure buying behaviours, which is the reason this report is particularly useful for analysing performance of this sector,” Mrs Burke said.   

“Within a university environment you have the academic, research and executive staff travelling for work purposes and leisure, and then you have the student travel component, which is primarily leisure travel.

“Campus Travel, which manages the travel programs of a large portfolio of Australian university clients, can use this data to help academic organisations to review how their current airline contracts are performing, and if the airfare discounts they are currently receiving are as competitive as they should be.

“University departments can also use the data in the report to work out if the budget they are allocating to research travel or professional development of staff or PHD students is enough for the next year.”

4D has in the past worked collaboratively with Campus Travel, to help a number of major Australian universities benchmark their airfare spend and activity.

General Manager of Campus Travel, Cathryn Cole, said 30 Australian universities already had existing airfare contracts with the Australian Universities Procurement Network – known as the AUPN deal.

“Many universities have a large volume of air travel and it’s essential they are continually reviewing what level of discounts they are receiving for their spend with airlines. Universities have an opportunity to leverage not just their business travel spend on academic travel but also their leisure travel spend across their entire employee and student populations,” Mrs Cole said.

According to both 4D and Campus Travel, there is a significant opportunity for Australian universities, particularly the larger players, to review the value and ROI they’re getting from their current air contracts.

“Australia’s university sector could well do with an industry-wide analysis of the value they receive in terms of fare discounts, from individual airline contracts versus group buying contracts. We believe that reports like the Airfare and Aviation Analysis highlight that this area of university procurement in particular is in need of a sector-wide evaluation,” Mrs Burke said. 

Below is a takeout of some of the key findings in 4D’s report -: 

Domestic Travel – CORPORATE Economy Class airfare benchmarking (Based on 2016 fare benchmarking against 2015 fares)

  • Domestic Economy Class price changes for tickets purchased through FCTG’s corporate travel brands ranged from -7% to a 4% increase on key routes
  • Business travellers flying the BNE – MEL and the BNE – PER routes have enjoyed the biggest savings with average purchase price of tickets on both routes falling by 7%
  • Corporates travelling on the CBR – SYD and the MEL – SYD routes struck out on any savings with the average purchase price of tickets increasing up to 4% from 2015 – 2016

Domestic Travel – LEISURE Economy Class airfare benchmarking (Based on 2016 fare benchmarking against 2015 fares)

  • From 2015 to 2016 the average price of domestic Economy Class leisure fares purchased through FCTG’s leisure division fell by 6%
  • Economy Class price changes for leisure tickets purchased through FCTG’s retail brands ranged from -10% to a 1% increase 
  • Big ticket savings for leisure travellers were highlighted on the BNE – SYD route with a 10% reduction on the average purchase price, while tickets purchased through FCTG by leisure travellers flying on the HBA – MEL and the BNE – PER routes dropped by 9% 
  • It was only on the MEL – SYD route, where capacity is tightly controlled by airlines due to the high volume of traffic, where travellers didn’t see a price reduction but rather wore a 1% increase on the average price of purchased fares.


Fare tracking conducted by 4D for first Quarter 2017 indicates a moderate increase of between 3% - 5% in domestic Economy Class fares across both the corporate and leisure buying groups. 

Further to this, both the major Australian airlines introduced ‘Days of the Week’ fares late 2016, which has travellers on certain routes, with certain ticket types paying a higher price to fly on Thursday and Friday. 

The data collected suggests a definitive shift away from the long-held beliefs of travel buyers – that booking 14-21 days in advance delivers the best deal on the busiest routes. With a likelihood of one in 10 tickets being changed by corporate travellers after a ticket is issued, 4th Dimension highlights that customers should consider the benefits of ‘flexible’ fares to avoid costly change fees. The report shows the average cost of change charged by the airlines is $165.

Internationally, the big changes in 2017 include:

  • Start of non-stop Qantas flights from Perth to London
  • Virgin Australia expanding to Hong Kong and Beijing
  • The opening of Qantas’ flagship international lounge due to open at London Heathrow 
  • Qantas adding services to Beijing and Tokyo (Narita) and;
  • Virgin Australia reintroducing a Melbourne to Los Angeles service. 

Strong demand for accommodation

4th Dimension research showed, that in the second half of 2016, there was strong demand for accommodation in Sydney, Melbourne and Auckland, as leisure and business travellers arrived in huge numbers for work, conferences and holidays. The upshot in demand fuelled accommodation rate rises in those cities, with hotel rates increasing two or three times more than what the traveller paid for flights. Looking ahead to the second half of 2017 and into 2018, room bookings in these metro hot spots are expected to continue, causing demand to outstrip supply in some cases during peak periods.

A snapshot of the report is below.




For more information please contact:

Sally Gordon












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