Qantas Airways Ltd, Australia's biggest airline by sales, slashed prices on some international flights to less than a third of the full rate as it tries to boost demand crimped by the Iraq war and SARS.
The reduced fares were available on flights up to Dec. 3, the airline said in a statement faxed to Bloomberg News. Qantas was offering a price as low as A$1,696 (US$1,119) for a flight to London from its base in Sydney.
A fully-flexible economy fare this weekend on the same route costs A$5,974.68, according to Qantas' Web site. A fully-flexible fare allows flights to be changed without incurring a charge and is refundable.
"They've obviously had a look at their forward bookings and realized they need to do something to fill their surplus seats," said Ian Thomas, an analyst at the Center for Asia-Pacific Aviation, a Sydney-based industry consultancy.
Qantas has forecast pretax profit to fall as much as a fifth in fiscal 2003 because the war in Iraq and the spread of SARS discouraged travelers.
It's also battling Richard Branson's low-cost Virgin Blue Pty, which has captured 30 percent of the domestic market since it started three years ago.
Yesterday, Qantas said it will create three business units as part of a drive to cut costs by A$1 billion. It has sacked more than 1,000 workers and delayed the delivery of new planes.
Qantas reports full-year earnings Thursday.
A flight between Sydney and Paris will cost as little as A$1,677, Qantas said. That's compared with a full Internet fare this weekend of A$6,002.98.
A Melbourne-to-Los Angeles flight was being offered at A$1,794, about 45 percent less than the A$3,993.21 fully-flexible fare on Qantas' Web site.
Qantas was also offering discounts on flights between some Australian cities to Hong Kong, Bangkok, Tokyo, Singapore, New York and Frankfurt.
"It's a traditional sales period," said Melissa Thomson, a Qantas spokeswoman, declining to comment further.
Qantas shares closed 1.6 percent higher on Friday at A$3.15 in Sydney. The stock's fallen almost 18 percent this year.
The July to September quarter "is traditionally a slow one" because people wait till closer to year's end to book vacations, Thomas said.
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