Qantas Expands Into Online Travel With TripADeal Stake

Australian airline Qantas announced today it had acquired 51% of the Australian-made online travel business TripADeal. The agreement provides Qantas with a pathway to buy the remaining 49% in four years, at an agreed multiple of TripADeals bookings at that time.

Qantas frequent flyers can now earn and redeem points on a TripADeal packaged holiday, regardless of which airline is part of the package. These include exploring Antarctica, Bali beach holidays, ski trips in Japan, African safaris or wine tasting tours in South Australia. Frequent flyers can book holidays using their points or ‘points plus pay’ and will earn three points for every $ 1 they spend with TripADeal.

Interestingly, the announcement detailed packages to Tokyo and Osaka in Japan, Delhi in India and Bali in Indonesia. These are all popular routes for Qantas, and no doubt the airline hopes to fill its Boeing 787s and Airbus A380s and A330s with passengers booking a TripADeal holiday.

A good deal for Qantas, TripADeal and frequent flyers

The Airbus A330 is a long-haul workhorse in the Qantas fleet and will benefit from TripADeal’s large leisure market exposure. Photo: Getty Images

The beauty of this deal is that the benefits flow both ways, to Qantas and TripADeal. Qantas immediately expands its exposure to the A $ 13 billion ($ 9.2 billion) online packaged holiday booking market while TripADeal taps into 14 million frequent flyers.

Qantas CEO Alan Joyce says TripADeal is “an Aussie success story built on delivering ready-made holidays at very sharp prices and their level of repeat customers shows how very well they do it.”

“Partnering with TripADeal means we can make Qantas Points part of the equation, which is great news for our frequent flyers and for our loyalty business more broadly. Buying a majority stake at the same time means we can benefit from the strong growth that’s going to follow as a result. “

Qantas is returning some of its fleet of 12 A380s to long-haul operations, on popular routes like London and Los Angeles. Photo: Qantas

Qantas Loyalty delivered during COVID and has a bright future with TripADeal

Founded by Norm Black and Richard Johnston in 2011, TripADeal specializes in packaged holidays with set itineraries including flights, hotel accommodation and tours. It employs around 100 people in two of Australia’s most popular holiday destinations, Byron Bay and the Gold Coast. It also has dedicated personnel in more than 30 countries to look after its guest’s on-ground experiences. It will continue to utilize a spread of airlines on its holiday packages, including Qantas and Jetstar.

TripADeal’s success is built on its thousands of direct relationships with hotels, tour operators and travel vendors. These relationships enable TripADeal to put together keenly priced packages and, in the 12 months prior to the pandemic, its bookings were in excess of A $ 200 million. Qantas Loyalty is targeting a return to double-digit growth in 2022 and an Underlying EBIT of A $ 500- $ 600 million by financial year 2024.

During COVID, Qantas Loyalty saw earnings grow and record levels of points redemptions and member engagement. Points redemption has doubled from pre-COVID levels, with Qantas Holidays, Qantas Hotels and Jetstar Holidays reducing the points required by 30% or more.

Joyce added: “The ways to earn points on the ground keep expanding, and we know that the number one thing people want to spend those points on is travel. That’s why the opportunities that TripADeal opens up for our frequent flyers will be so positive. “

It’s interesting that Qantas CEO Alan Joyce acts quickly to shed staff, like baggage handlers, but also acts quickly to add new revenue sources. Is an airline selling travel a step back in time?

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