Australians can expect cheaper flights in the lucrative aviation "golden triangle" between Brisbane, Sydney and Melbourne, a new report has predicted.
Rex Airlines' end of year expansion into some of Australia's most prized intercity routes saw Qantas, Virgin and Jetstar all react by slashing their ticket prices in December, according to analysis by the Australia Competition and Consumer Commission (ACCC).
Rex announced in November that from mid-December it would begin flying Brisbane-Sydney and Brisbane-Melbourne routes.
On the Brisbane–Melbourne route, Virgin matched Rex at $79, Jetstar undercut Rex with sale fares at $65 and Qantas lowered fares from $194 to $119, the ACCC revealed in its latest Airline Competition in Australia report.
Similarly, on the Brisbane–Sydney route, Virgin matched Rex's $69 fare, Jetstar undercut Rex with sale fares at $55, and Qantas dropped fares from $163 to $109.
Rex is already flying on the popular Melbourne–Sydney, Melbourne–Adelaide and Sydney–Gold Coast routes.
"With Rex's entry, consumers will benefit from competition between three airline groups on what are normally Australia's five busiest routes," the report said.
Together these five routes carried over 22 million passengers each year before COVID-19 hit, more than a third of all domestic passengers.
Next year, Aussie travellers will also benefit from the entry of independent low-cost carrier Bonza next year.
While announcing its launch, Bonza declared it would specialise in flying into leisure destinations not served by other airlines.
The ACCC warned it would "be alert" to any anti-competitive capacity or pricing practices by other airlines in response to new competition in 2022.
Over the last decade, the Australian airline industry had suffered over $4 billion in losses, the report said, with the vast majority lost in recent years because of COVID-19.
Qantas and Rex had been profitable in the few years leading up to the pandemic.