Six months into leading Fiji Airways, chief executive Paul Scurrah says rising global fuel prices caused by ongoing conflict in the Middle East are creating major challenges for the airline industry.
Despite inheriting an award-winning carrier, Scurrah said his attention is now heavily focused on managing fuel costs as jet fuel prices continue to climb.
“For us, the situation's a little bit different because of our relative geographic isolation and how close we are to our two biggest source markets, Australia and New Zealand,” as quoted by Stuff.
Rather than introducing a direct fuel surcharge on tickets, Fiji Airways is increasing fares through its revenue management system, where pricing algorithms adjust ticket costs according to demand and operational expenses, Stuff has reported.
“It would be impossible to keep flying the network we're flying without making sure we recover on the revenue side,” Scurrah said.
“Things change every day with what's happening in the Middle East, and, as that evolves, we will make some decisions,” as quoted by Stuff.
The airline’s financial outlook has been supported by strong tourism growth, with Fiji recording 71,765 visitors in March, up 12.4% compared with the same month last year.
“People are seeing Fiji as a safe, family-friendly and close destination, particularly for New Zealanders,” Stuff has quoted.
Scurrah said the airline is also seeing growing interest from American tourists, many of whom are choosing Fiji over more traditional holiday destinations.
“Traditionally, they would have looked at the Caribbean, Mexico and Hawaii. We're seeing real interest in coming to Fiji because of the natural beauty, and there's a lot of high-end products that really appeal to the Americans, as quoted by Stuff.
“The world's learning about Fiji as a beautiful destination for snorkelling, for surfing, for fly and flop, beautiful luxury hotels, so the US is a big focus for us.”
Fiji Airways currently operates services from Nadi to Dallas-Fort Worth, Los Angeles, San Francisco and Honolulu. Scurrah revealed the airline had also considered expanding to Las Vegas, but the route was ultimately ruled out.
Although US visitor numbers to Fiji remain strong, Scurrah acknowledged demand for flights from New Zealand and Australia to the United States has weakened.
“There’s no question about that. It’s partially offset by an increase of Americans still coming this way, but it is hurting the industry, the drop-off in demand between the South Pacific and the US,” Stuff has quoted.
In contrast, flights to Vancouver are performing strongly, particularly among New Zealand travellers.
“We're seeing a lot of New Zealanders on those flights, which is great, and they're really enjoying the break in between in Nadi. In fact, we're seeing a lot of people take what they're calling a ‘tropical pause’ on their way through to Vancouver now.
“That’s very, very popular, and it's a deliberate 48-hour curated product that has early check-in, late check-out, and no departure tax. New Zealanders are really taking advantage of it,” Stuff has quoted.
Scurrah said other international routes, including Tokyo, Hong Kong and Singapore, were also attracting strong support from New Zealand passengers.
“Our Tokyo services are seeing strong support from New Zealand, Hong Kong is seeing strong support, and so is Singapore. Those services are doing really well.
“If we had more planes to put on those routes we would do it, but our routes are under review every day,” Stuff has quoted.
The CEO also hinted at a new onboard wellbeing initiative that Fiji Airways plans to unveil in the coming weeks, as airlines compete to offer unique passenger experiences.
“We've got some really exciting things coming that's focused on the wellbeing side, for our crew and our passengers. Not quite ready to announce it, but we are really confident that we'll have a unique point of difference that really stands us out from the rest of the airline industry.”
Meanwhile, Fiji Airways plans to increase Christchurch services to four flights a week between June and October, with the possibility of extending the schedule year-round.
“Nothing's confirmed just yet, but we love our New Zealand connection and partnership; there's a real affinity between New Zealand and Fiji, and I think people are seeing us as a really good, reliable airline that can be trusted and provides an amazing service, as quoted by Stuff.
“Queenstown is something we would have a look at. Dunedin hasn't come up, but I wouldn't rule it out.”
According to Stuff, Scurrah said the airline has also explored ideas including South American routes and Antarctic sightseeing flights, although he admitted some concepts may not be practical.
“I don't think we can do it, we're not as far south as Qantas, but, you know, it's amazing these sort of ideas that get put across your table, as the CEO of an airline,” Stuff has quoted.
Beyond business strategy, Scurrah said he has personally been struck by Fiji’s natural beauty since taking up the role.
“I did a jet ski safari with some friends, where we weren't that far offshore before some of the most beautiful snorkelling you'd ever imagine was right there.
”I think that's the thing that surprised me most is absolute stunning beauty is just not that far away,“ Stuff has quoted.
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