Is it?While higher value (i,e. very frequent flyers and...

Is it?

While higher value (i,e. very frequent flyers and business/first class passengers) may have plenty of savings, income and willingness to travel, the RBA's cash rate today (with the possibility of more to come in future months) will dampen consumer confidence, even though not everyone has a mortgage, car loan or other commitment.

In tomorrow's 'Australian' there's to be a story about how international travel demand to Europe is softening for summer 2023 (although not everyone travelling has yet booked). Domestic air leisure travel demand is also somewhat weaker going by what I've read, and business travel hasn't totally recovered to 2019 levels.

Airlines need reasonable yields and fairly full cabins to stay profitable.

Today's fall in the A$ may only affect QAN marginally (after all, it can 'reverse') but a decrease in travel demand is a lot more concerning, irrespective as to where the oil price goes, because aircraft and expensive staff may then start to be less intensively used than at present, and a few aircraft may be idle each day. The high fixed costs of QAN (and competitors) soon result in lower ROIC and perhaps eventually red ink.

The next dividend may well be years off, assuming the company survives despite its shockingly low $10 million in NTA.