|
Deputy minister backs airline request for higher fare ceiling
A higher ceiling price for air fares would help domestic airlines provide passengers with more flexible ticket price options, said Deputy Minister of Transport Pham Quy Tieu, who heads the Viet Nam Civil Aviation Department.
The ministry last month granted in-principle approval to a proposal for Vietnam Airlines to raise the ceiling by 1.5 times over current fare levels.
The higher ceiling would give the airline some latitude to stagger fares for different flight, giving customers a wider range of choices and allow airlines to shift passengers towards cheaper, undersold flights, saving money for passengers while reducing losses for the airline, Tieu said.
Domestic air fares are already low compared to other countries, and carriers are facing possible losses on domestic routes due to the high cost of fuel and fluctuations in the exchange rate between the Vietnamese dong and the US dollar.
If the ceiling price was not increased, local airlines would have more difficulties in competing during a period in which many carriers have entered the domestic market, Tieu said.
If the Government approves the new fare ceiling, the new fares would be applied next month.
The current ceiling on air fares, excluding value-added tax (VAT) and other fees, is VND863,636 per unit (US$42) for distances below 300km, VND1.1 million ($53) per unit for flights of 300-500km, VND1.48 million ($71) for 500-850km, VND1.9 million ($91) for 850-1,000km, VND2.23 million ($107) for 1,001-1,280km, and VND2.7 million ($130) for flights longer than 1,280km.
Viet Nam has three domestic airlines operating domestic routes, Vietnam Airlines, Jetstar Pacific and Air Mekong.
vietnamnews
|
