The overnight news from the Paris Air Show has consequences for Australia’s tourism operators, its airports, anyone thinking of overseas holidays and of course its airlines.

If the dots are connected in terms of the big jet spending spree now going at full throttle and full bottle in the marquees and chalets out at the otherwise seldom-used Le Bourget airport at least $8.5 billion in new airliners are getting pointed at the Australian market in the next one to five years.

Not by Qantas, or Virgin Blue, but Emirates ($4.8 billion), Fly Asian Express ($2.7 billion) and Thai ($0.8 billion).

These are the catalogue figures, not the secret ‘deal’ figures, but don’t include finance costs for the latter two, while the favourite Qantas ‘bete noir’ Emirates, which is doubling in size every five years, is set to treble its seats to Australia even sooner, and seems to run on cash.

And more is expected before the show is over at week’s end from Singapore Airlines according to one whisper, and Kingfisher, which intends to become India’s answer to Qantas, which has been almost totally unopposed until now on the fast growing non-stop services between both countries.

These orders, 12 more giant A380s for Emirates, a total of 23 mid sized A330s for Fly Asian Express and Thai, and the anticipated confirmation of 20 new technology A350s for Singapore Airlines and extra assorted Airbuses for Kingfisher, stack up some interesting numbers against the $3.5 billion for Virgin Blue’s trans Pacific Boeing 777s and $10 billion in extra A380s and 45 Boeing 787s for Qantas/Jetstar.

Emirates says it is looking at replacing all its major services with 500 seat A380s, with orders for 55 of them and plans to buy 100 less grandiose 787s or A350s to serve smaller cities or shorter routes.

That means using at least 16 A380s to serve its existing schedules to Melbourne, Sydney and Brisbane, compared to Qantas orders for 20 of the biggest ever passenger jet but spread over the US as well as Middle Ea$$st and Europe/UK markets where Emirates has surged into prominence.

But the first effect of the buying spree seems certain to be seen in Melbourne’s ‘budget’ airport, Avalon, where Fly Asian Express founder and chairman Tony Fernandes is determined to launch his shiny new A330s with tiny but very cheap seats by around October.

Fernandes doesn’t have London in his sights yet. His target is Singapore’s Tiger Airways, which is so far coming off a distant second best in terms of regional expansion compared to his ‘other’ airline AirAsia, which is the outrageously successful Malaysian version of Ryanair or Jetstar domestic.

With Tiger’s Australian division due to launch from its Melbourne headquarters in the same last quarter of this year, it’s a cat fight that has spread to Australia as Fernandes tries to keep his brand on top of the main battle to dominant low cost air travel expansion from India to the Philippines and Australia to China.

The fact that Jetstar might get scratched and bitten in the process (or inflict its own wounds on both) doesn’t seem high on the Fly Asian Express agenda at this early stage, but Tourism Victoria is certain to be the big winner.

This dynamic, of Australian tourism operators and consumers being the accidental beneficiaries of a larger competitive punch-up, is also true of the battle royal between Singapore Airlines (which owns half of Tiger) and Emirates.

What happens in Australia is nowhere near as important as the struggle by Singapore to prevent Changi Airport having its status as the prime hub of Asia eroded by the vast alternative network Emirates is building over Dubai.

So far Changi is losing the fight. Which means it’s a case of two large fleets of A380s and a host of brand new medium sized jets chasing each other all over half the world’s air travel markets including ours.

With the millions of additional visitors on hand in their own home markets for Fly Asian Express, Emirates, Kingfisher, Tiger and other soon to arrive carriers such as Viva Macau and Oasis Hong Kong, what chance would Qantas have of playing the poor struggling victim card in Canberra to slow down the onslaught.

None really. The $18 billion reality of a Qantas full of hidden value has well and truly emerged from the failed APA heist.

Qantas is on its own, but looking good.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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