The airfare war has spread to Adelaide and there are positive signs Tasmania may be next to see the benefits of competition that the new domestic airlines have already brought to mainland east coast routes.

Virgin Blue has announced it will start direct flights between Adelaide and Sydney from March 1 with a range of low one-way fares that Qantas has been quick to match.

Leading airfare comparison website FlightChoice.com.au believes these are great signs for competition. Manager of FlightChoice, Cassandra Emery, said: "The winner out of all this is the Australian air traveller because it is more evidence that competition is taking hold and lower airfares are here to stay.

Virgin says the decision to expand Adelaide services has been prompted by the popularity of its Sydney-Brisbane and Adelaide-Brisbane routes.

As a start-up offer for the first nine days, Virgin is offering all seats on flights on the route for $99 one-way which has been matched by Qantas over the same period.

Virgin launched its Adelaide-Brisbane service in December and is now offering a discount fare of $149. Qantas has increased capacity and lowered its best one-way fare, currently $257.40. Ansett is offering a 5-day advance-purchase fare of $259.27.

Meanwhile, Impulse Airlines has announced intends to service Tasmania before the end of 2001 and Virgin is showing interest, too, already advertising for staff in Tasmania.

"And with Impulse's decision to fly direct between Melbourne and Canberra, there are now some great fares to be had from the four main domestic airlines on most routes between the mainland capital cities," Ms Emery said.

"This latest round in the airfare war show that both the established airlines and the new players are deadly serious about their place in the market."

FlightChoice allows travellers to compare the lowest airfares available from each of the four major domestic airlines, online, www.flightchoice.com.au.

Contact : Cassandra Emery Manager, FlightChoice.com.au 02 9247 6788 0403 316 534