High-tech check-in

Qantas Airways has a plan to stop its top customers defecting to cheaper rivals.

Qantas Airways has a plan to stop its top customers defecting to cheaper rivals: high-tech frequent flyer cards that allow passengers to check in quickly. In an overhaul of its domestic check-in operation, Qantas said yesterday it will soon start issuing Frequent Flyer cards embedded with computer chips that can function as boarding passes.

Chief executive Alan Joyce promised that the change would halve check-in times and reduce travel stress.

But not all Qantas's six million Frequent Flyer cardholders will get them, at least initially. Qantas said the new cards would be given only to members with Silver cards and above, meaning casual flyers will have to continue to use regular boarding passes.

Qantas dominates the Australian domestic airline market with a 65 per cent market share. Virgin Blue and low-cost Tiger Airways, which recently began flying the popular Sydney-Melbourne route, have been chipping away at its market share.

Dubbed the "next generation check-in", the Qantas system will include scanners that can read the cards, meaning passengers won't have to show a pass as they board their flight. Bag tags will replace the stickers used to label luggage.

The scanners will be installed initially at Perth's airport at a cost of $40 million. Sydney should get the scanners by the end of next year and Melbourne in early 2011, Mr Joyce said. The company did not reveal the total cost.

Qantas said it was also working on ways to use technology to speed up security protocols, the most common complaint among passengers. The increasing reliance on technology to whisk people through airports is expected to eventually lead to fewer staff at airport terminals, although Mr Joyce said staff would still be needed for the check-in process. No widespread job cuts were imminent, he said.

Qantas' low-cost offshoot Jetstar has been trialling mobile phone technology that allows passengers to use a text message sent by the airline as their boarding pass. Such a system is used by some bus operators overseas.

Mr Joyce also said yesterday that heavily discounted air fares could be drying up as more people take holidays. Airlines have been cutting ticket prices in the past 12 months to fill planes, and taking big losses.

"We always said get them [the cheap deals] while they last," he told an aviation industry lunch in Sydney yesterday. "We are seeing the pricing power is definitely starting to return because the leisure market is starting to turn. We are not seeing a significant improvement in the business market."