Sat, May 10, 2008 - Page 4 News List

Domestic airlines announce plans to increase fares to reflect price of oil

STAFF WRITER, WITH CNA

Domestic air carriers will raise their air fares by an average of 30 percent for international flights starting next month to reflect surging fuel costs, the airlines announced yesterday.

Bruce Chen (陳鵬宇), a public relations official for China Airlines (CAL), Taiwan’s largest carrier, said that the summer is usually a busy travel season and that because of the cost of rising fuel prices, the airline is planning to hike air fares starting on June 15.

Air fare hikes will peak in July and August, Chen said. EVA Airways Corp spokesman Nieh Kuo-wei (聶國偉) said that the fuel price for air carriers has risen from US$84 a barrel last year to US$145 a barrel. Fuel costs used to account for 20 percent of the airline’s operations costs, but the ratio has now risen to 50 percent, Nieh said.

“The air carrier has no option but to adjust its air fares,” Nieh said.

UNI Airways Corp has hiked its air fares since March and will adjust it further next month.

The airlines’ ticket prices are expected to reach a peak late next month or early July.

CAL and UNI have made the biggest fare increeases on their long-haul flight routes, such as to Europe or the US.

Nieh said that although the price hike will average 30 percent, it still will not cover the expenses of fuel costs.

He said that the ticket price hike will surely impact the tourism market, but the carrier “has no other choice.”

He said that EVA lost NT$1.8 billion (US$59.02 million) last year, but that the air carrier has lost up to NT$2.3 billion in the first quarter of this year alone.

“If EVA Airways is suffering serious losses and is forced to cut or suspend certain flight routes, then it will be even more damaging to the passengers,” he added.

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