Qatar Airways has captured a 12% share of Adelaide’s international market since launching services to South Australia in May-2016. The new Adelaide-Doha route has driven rapid international growth at Adelaide despite leading to a decline in traffic on the Adelaide-Dubai route.
Qatar Airways launched flights to Adelaide on 3-May-2016 with a daily service from Doha using 283-seat two class A350-900s. Qatar reduced the service to five weekly flights at the end of Oct-2016 but is planning to reinstate daily flights on 2-Dec-2017.
In the first 13 months of operating the route, Qatar Airways carried almost 119,000 passengers to and from Adelaide, according to BITRE data. BITRE does not provide load factor information by route but based on the number of scheduled flights, Qatar’s average load factor during this period (May-2016 through May-2017) was approximately 65%.
While the load factor has been relatively low, prompting the initial decision to reduce the number of frequencies, Qatar has succeeded at capturing a significant share of the overall South Australia market. Qatar accounted for 12% of total Adelaide international passenger traffic in its first year of operating the Adelaide-Doha route.
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Adelaide recently reported 11% growth in international passenger traffic for the fiscal year ending Jun-2017 to 952,000. Qatar Airways and China Southern Airlines, which launched services to Adelaide in Dec-2016, drove the international growth at Adelaide over the last year. Bali and Dubai traffic declined while traffic in Adelaide’s four other international markets – Auckland, Hong Kong, Kuala Lumpur and Singapore – have been relatively flat.
The Dubai decline is not surprising as Emirates has obviously been impacted by Qatar’s launch. Emirates’ Adelaide traffic dropped by 12% in calendar 2016 to 187,000 passengers (with the decline occurring the last seven months of the year), according to BITRE data. Emirates, which operates daily service to Adelaide using three class 777-300ERs, also had a sharp traffic decline in Adelaide in 1Q2017.
Not surprisingly, Emirates has lost market share to Qatar in the Adelaide-Europe market. Qatar captured a 34% share of total Adelaide-Western Europe bookings in the year ending May-2017 while Emirates captured a 37% share, according to OAG route Analyser data. Qantas, which puts some of its Adelaide-Europe passengers on Emirates, captured a 14% share of bookings and Singapore Airlines was the fourth largest player with a 7% share.
In the year prior to Qatar’s launch of services to Adelaide, Emirates captured a 51% share of the Adelaide-Western Europe market, followed by Qantas with 18% and Singapore Airlines with 10%. Malaysia Airlines also has lost significant market share, from 7% to less than 2%, but this is mainly driven by its suspension of routes to continental Europe.
Qatar has stimulated demand in the Australia-Europe market by offering competitive fares. However, the rate of capacity growth has exceeded the rate of traffic growth. All-inclusive fares between Adelaide and Europe including London now start at only AUD1000.
European residents accounted for 38% of total visitors to South Australia in the year ending Mar-2017. Europe is also a popular holiday destination for South Australian residents. South Australia-Middle East is a very small market in terms of both outbound and inbound travel.
Qatar also has shaken up the premium end of the Adelaide-Europe market with aggressively priced business class fares. The A350 Qatar uses to Adelaide has 36 lie flat business class seats with all aisle access.