Airlines’ pledge on cheap fares

Qantas and Virgin Blue say they have no immediate plans to raise air fares in the wake of Ansett's latest collapse and have also guaranteed that discount tickets will still be available to consumers.

Transport Minister John Anderson says that while the government wants competition in the domestic aviation market between Qantas and Virgin Blue, it does not want to over-regulate and “nobble” the two operators.

The ACCC's Allan Fels says that he has received complaints against Qantas over alleged predatory behaviour and capacity dumping last year and he vows to keep a close eye on the market. Professor Fels says that each time a new cut-price player comes in, like Compass or Impulse, prices go down but when they go, prices increase.

Virgin Blue's Amanda Bolger says that the airline will continue with its discount philosophy. The only reason that its fares might go up, she says, is if fuel prices increase or the dollar drops.

Qantas spokesman Michael Sharp says there are two million discount fares in the market for April and May, and that Qantas could easily cover the overflow of former Ansett passengers.