The regulator also confirmed it was investigating Qantas after customers reported difficulties in using flight credits, but did not comment further as the investigation was ongoing.

Loading

Qantas carried 39 per cent of all domestic passengers in July, compared with 33 per cent for Virgin and 5 per cent for Rex. All three increased their market share after winning passengers from Jetstar, whose market share fell to 23 per cent. Qantas and Jetstar combined carried 62 per cent of passengers, slightly down on April.

Business airfares rose 17 per cent between June and August, the consumer watchdog found.

“Pent-up demand for leisure travel, particularly from people in the colder southern states, continues to drive the recovery in passenger numbers,” said Cass-Gottlieb. “Demand on routes between Canberra, Melbourne and Sydney has lagged ... in part due to the slower recovery of corporate and business travel.”

There were 43 carriers offering international passenger services to and from Australia, compared with 57 before the onset of COVID-19, the report said.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.