The Australian Competition and Consumer Commission has reported that very high demand for domestic air travel during September and October 2025 placed significant pressure on seat availability and contributed to higher airfares in October. According to the latest Domestic Airline Competition report, more than 5.5 million passengers travelled domestically in October 2025, representing a 3.8 per cent increase compared with the same month in 2024 and marking the second highest passenger volume since January 2019.
Unusually strong demand was partly driven by major sporting events, with interstate teams featuring in AFL and NRL finals, leading to increased travel to Melbourne and Sydney. In response, Qantas Group and Virgin Australia added more than 45 additional flights to their networks, lifting overall seating capacity by 4.5 per cent compared to October 2024. Despite this increase, flights remained fuller than normal, with a load factor of 84.4 per cent, above the 12-month average of 81.6 per cent. As a result, average airfares in October 2025 reached their highest level since December 2022 and were 3.2 per cent higher than a year earlier.
The report also highlighted the proposed acquisition of Regional Express by Air T as a positive development for regional connectivity. The planned transaction is expected to preserve essential services and maintain competitive pressure on regional routes following Rex’s entry into voluntary administration in July 2024.
Service reliability declined in October due to adverse weather, particularly in Sydney, with on-time arrivals falling to 74.1 per cent. Cancellation rates remained stable at 2.1 per cent. The report further noted that sustained profitability by Qantas Group and Virgin Australia reflects strong passenger demand but also the limited competitive intensity of the domestic aviation market, which continues to be dominated by the two major airline groups.
The ACCC reiterated that increased competition remains essential to deliver lower airfares and greater choice for consumers.