ACCC: Australian Domestic Airline Competition at Critical Juncture

A person looking at a flights board at an airport
A person looking at a flights board at an airport

The Australian Competition and Consumer Commission (ACCC) has released its final Airline Competition in Australia report at the end of its three year monitoring and reporting role assigned by the former Treasurer in 2020.

The data gathered shines a light on the Australian domestic airline market as a place dominated by Qantas and Virgin, with those two airlines accounting for over 90% of domestic airline travel over the past 3 years. Even with the launch of Bonza and the expansion of Rex to intercity flights, the duopoly of Qantas and Virgin is unlikely to be significantly impacted in the short-term.

As part of the report the ACCC has also advocated a few key reforms that will be boost competition and consumer protection:

  1. Reforming the legislative scheme allocating take-off and landing slots at Sydney Airport (Australia’s busiest airport) – a critical step to actual competition in the domestic airline industry.
  2. New regulatory incentives in the form of an empowered and truly independent, and external, dispute resolution ombuds scheme – based on the sustained decline of airline customer services.
  3. Reform of the consumer guarantees under the Australian Consumer Law to make a business’ failure to supply remedy for consumer guarantee faults illegal – a move which would “would dramatically improve incentives for all businesses, including airlines, to comply with their obligations and more effectively protect consumer rights.”

The ACCC’s specific in-depth monitoring of domestic airlines may be at a close but as ACCC Chair Gina Cass-Gottlieb has said: “While our airline monitoring direction is ending, we’ll continue to watch for anti-competitive behaviour and unfair business practices in the airline industry. If we see evidence of this occurring, we will use our full range of enforcement powers to achieve compliance with the law.”

For the full ACCC media release click here.