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Australia’s newest low–cost start–up Bonza Airlines will provide vital low–cost competition in a ‘full-service dominated market which could expectedly be a disruptive force. COVID-19 has presented Bonza Airlines with a prime opportunity to get launched with the current situation aiding its expansion plans of filling the void in the Australian air routes, says GlobalData, a leading data, and analytics company.
Gus Gardner, Associate Travel and Tourism Analyst at GlobalData, comments: “Bonza Airlines is well-positioned to fill the void left by Tigerair’s exit and will place pressure on incumbent players, Qantas Airways and Virgin Australia. There is a gap in the market for a new low–cost carrier, and Bonza Airlines fits right in.
“Although GlobalData figures show that air took 25 million domestic trips in 2019 (pre-COVID-19) across Australia, competition between airlines has remained low and underserved communities have suffered. The new entrant’s strategy to connect underserved airports and target leisure travelers could see the airline become a sizable competitor over the coming years.”
GlobalData’s Q3 2021 Consumer Survey* has revealed that 77% of Australian respondents were ‘extremely’, ‘slightly’, or ‘quite’ concerned about their personal, financial situation, reinforcing the need for lower-cost air connectivity in Australia.
Mr. Gardner continues: “those looking for cheaper travel options will meet positively The launch of a new low-cost carrier. COVID-19 has placed a considerable strain on the travelers’ budgets and the desire to escape on vacation has risen considerably. Operating a low–cost business model will bear fruit for Bonza Airlines. The low–cost base, coupled with expected pent-up demand for low–cost flights, could see the airline quickly become popular.
“54% of Australian respondents in GlobalData’s Q3 Consumer Survey* suggests that affordability was the top factor taken into consideration when deciding where to go on holiday. Offering low prices will be vital to encouraging travel during the COVID-19 recovery period. Low prices, a favorable network, and no-frills service could see Bonza Airlines thrive.”
With the domestic and interstate travel restrictions beginning to ease and travelers seeking a change of scenery, 2022 is an optimal time for Bonza Airlines to launch.
Mr. Gardner concludes: “COVID-19 has provided an optimal environment to launch. An abundance of attractively priced second-hand aircraft, airport slots, and skilled labor (pilots and cabin crew) means previous barriers to entry have been lowered. Bonza Airlines is likely to possess a low–cost base, resulting in lower fares and the ability to win market share from the competitors.
“A lack of low–cost competition in Australia will see the carrier become popular with budget-conscious travelers. We expect leisure travel to benefit those seeking leisure destinations who will favor the post-pandemic and the airline. All factors combined bode well for Bonza Airlines.”
* GlobalData Q3 2021 Consumer Survey, 569 Australian respondents
Edited by: Stephen Morton