Qantas may hike fares and expand Jetstar add-on fees as profits dip to four-year low
Guardian AU Business
β’Thu, 27 Aug 2026 05:03:31 GMT
π° What Happened
Qantas indicated it may raise ticket fares and expand add-on fees at its budget carrier Jetstar after reporting its lowest underlying pre-tax profit in four years. The airline posted underlying pre-tax profit of USD 2.06 billion for the year to 30 June, dragged down by higher fuel costs. Chief executive Vanessa Hudson told analysts the company would keep pushing for revenue because passenger demand remains strong. Qantas also said it would begin retiring its older, fuel-hungry A380 jets as it renews the fleet.
π The Backstory
Australia's national carrier spent years navigating a bumpy recovery from the COVID-era grounding of travel and years of reputational damage over cancelled flights and poor service. Jet fuel costs spiked in connection with the conflict in Iran, and Qantas's older A380 fleet absorbed that burden unevenly, chipping away at margins. The airline has emphasised its commitment to fleet renewal while cutting some of its least economical older planes. It now faces the challenge of maintaining its premium reputation while the country contends with persistent cost-of-living pressures.
π― Why It Matters
A dual-track strategy of hiking tickets and extending Jetstar add-on fees affects millions of everyday passengers, from holidaymakers to regular flyers, especially amid a cost-of-living squeeze. It signals that fuel-driven inflation is being passed onto consumers rather than absorbed by corporate earnings. The announcement sets expectations for how the air travel sector will run profitably through a mixed post-pandemic demand environment. For observers of the Australian economy, the move becomes part of a wider story of price pressure arriving at the point of purchase.
Qantas indicated it may raise ticket fares and expand add-on fees at its budget carrier Jetstar after reporting its lowest underlying pre-tax profit in four years. The airline posted underlying pre-tax profit of USD 2.06 billion for the year to 30 June, dragged down by higher fuel costs. Chief executive Vanessa Hudson told analysts the company would keep pushing for revenue because passenger demand remains strong. Qantas also said it would begin retiring its older, fuel-hungry A380 jets as it renews the fleet.
Australia's national carrier spent years navigating a bumpy recovery from the COVID-era grounding of travel and years of reputational damage over cancelled flights and poor service. Jet fuel costs spiked in connection with the conflict in Iran, and Qantas's older A380 fleet absorbed that burden unevenly, chipping away at margins. The airline has emphasised its commitment to fleet renewal while cutting some of its least economical older planes. It now faces the challenge of maintaining its premium reputation while the country contends with persistent cost-of-living pressures.
A dual-track strategy of hiking tickets and extending Jetstar add-on fees affects millions of everyday passengers, from holidaymakers to regular flyers, especially amid a cost-of-living squeeze. It signals that fuel-driven inflation is being passed onto consumers rather than absorbed by corporate earnings. The announcement sets expectations for how the air travel sector will run profitably through a mixed post-pandemic demand environment. For observers of the Australian economy, the move becomes part of a wider story of price pressure arriving at the point of purchase.