9.5% price rise for Impulse fares

From Monday, Impulse Airlines will increase the price of their airfares by 9.5 per cent as a flagging Australian dollar and soaring jet fuel prices take their toll. Similarly, Virgin Blue will make a decision regarding any fare increases in the upcoming weeks. Impulse and Virgin Blue are feeling the pinch of rising fuel costs because, unlike Qantas and Ansett, both airlines purchase their fuel at “spot” prices. This means that fuel is bought at the current price, whilst larger carriers such as Qantas and Ansett have the opportunity to buy their fuel at an agreed, fixed price (known as “hedging”) that protects them from the price hikes. Impulse’s executive chairman, Mr Gerry McGowan, said that the company’s operational costs had risen by 25 per cent.

‘Impulse fares set to rise 9.5pc’, The Australian Financial Review, 19/10/00, p 7.