Research Insights LCCs capture increased share of growing market in ANZ region

LCCs capture increased share of growing market in ANZ region

October 2023
Phocuswright Research

In the Australia and New Zealand travel market, strong demand for both domestic and international flights has driven airfares higher which, when coupled with full flights, resulted in gross revenue growth of 153% to US$15.5 billion in 2022. According to Phocuswright’s Australia New Zealand Market Report 2022-2026, supply continues to expand as existing players slowly return to pre-pandemic capacity as well as add new routes, and as new players enter the market.

While many expect this increased volume to result in a reduction in airfares, others point out that high fuel costs will temper airlines' abilities to make significant reductions. Therefore, overall sector gross revenue is expected to continue to grow steadily, driven by both increasing volume and high fares, and reach US$21.1 billion, or 115% of 2019, revenue in 2026.

With average fares high, the budget end of the market is expected to see higher than average growth, driven by an expansion of both Qantas subsidiary Jetstar and the 2022 entry of new independent player Bonza to the market. Launched in early 2023, this true low-cost carrier has already expanded its point-to-point network with routes not previously serviced by traditional players. Therefore, the low-cost carrier component of the Australia/New Zealand air market is expected to expand from 15% in 2022 to 17% in 2026, capturing an increased share of a growing market.

Phocuswright Chart: China Travel Bookings
(Click image to view a larger version.)

This report provides a comprehensive view of the Australia/New Zealand (ANZ) travel market, including detailed market sizing and projections through 2026, distribution trends, analysis of major travel segments, key developments and more.

This report is part of the Asia Pacific Travel Market Report 2022-2026 series, which includes all of the following publications (available now or publishing soon):

Research is our priority. Our Open Access research subscription puts the world’s most comprehensive library of travel research and data visualization at your fingertips.

Clients have relied on Phocuswright's deep industry knowledge for over 25 years to power great decisions, help justify a pitch, build a strategic plan and elevate any presentation through trusted research and data. When companies and executives reference Phocuswright, they gain the trust of an industry keen on data, trends and analytics.

For further intelligence for you and your entire company, subscribe to Phocuswright Open Access.