The nation’s largest air carrier said on Saturday that the decision to offer discounted cross-strait flights starting yesterday was voluntary and not the result of government pressure.
China Airlines (CAL) said the cut was based on the company’s steadily improving operational performance following the 2008 economic downturn.
“Since the first quarter of this year our revenue has been much higher than expected,” company spokesman Hamilton Liu (劉國芊) said.
Acknowledging that cross-strait flights have played a major role in generating profits, Liu said the discount was initiated as a way of rewarding customers.
Starting yesterday, the fare for popular CAL routes such as Songshan-Hongqiao and Taoyuan-Nanjing will drop from NT$10,580 to to NT$9,500 for round-trip tickets with a stay of up to 14 days.
At present, the carrier provides 61 roundtrip flights to 14 destinations in China every week.
The price cut comes amid public complaints that prices for direct cross-strait flights are excessively high. The government has said it cannot intervene, but launched what it called a “moral suasion” campaign to persuade the carriers.
“We have discussed the issue with the carriers five times since early this year,” said Yeh Yung-ching (葉永清), director of the air transport division of the Civil Aeronautics Administration.
What the government could do, he said, was use its position as the company’s biggest shareholder to urge the airline to lower fares, prompting other carriers to follow suit.
EVA Airways and TransAsia Airways, said earlier this month they would cut cross-strait ticket prices from yesterday and Oct. 26 respectively.
As demand for direct cross-strait flights still greatly exceeds supply, both carriers and the travel industry have said the best solution would be to allow more flights, as that would enable the market to adjust itself.
“We’re limited to 370 flights a week, and you cannot expect fares to be competitive in that case,” said Spicer Lee (李先生), a spokesman for the Taipei Association of Travel Agents.
China and Taiwan agreed in May to add 100 new cross-strait direct flights to bring the total to 370.