Domestic air fares set to rise on Jan. 1

READY FOR TAKEOFF::The biggest price increase is scheduled for flights between Taipei and Kinmen, the cost of which will rise by between 10 and 20 percent

By Shelley Shan  /  Staff reporter

Wed, Jul 17, 2013 - Page 4

The Civil Aeronautics Administration (CAA) yesterday announced that fares for domestic flights would rise on Jan. 1, adding that it would at the same time increase ticket subsidies for residents of outlying islands.

Domestic flight prices have remained unchanged for eight years, despite the cost of aviation fuel increasing from an average of NT$13.26 per liter in 2004 to NT$27 per liter last year.

The administration held a public hearing in April on raising the prices of domestic flight tickets, with proposed percentage increases for different domestic routes ranging from 6 percent to 35 percent.

However, the proposals were opposed by lawmakers representing outlying islands and remote areas, as well as local government officials.

Earlier this month, the Ministry of Transportation and Communications was reported to be considering capping price increases at 20 percent.

CAA Director-General Jean Shen (沈啟) said the ministry had yet to approve the CAA’s proposals, but domestic flight ticket prices are scheduled to rise on Jan. 1.

Passengers wanting to fly during next year’s Lunar New Year holiday, which begins on Jan. 30, would have to buy tickets at the new prices. The rule applies to all travelers, including residents of remote areas and outlying islands.

In view of the burden that the price increase would have on those residents, Shen said that the administration would reduce landing charges for airlines offering flights in these areas.

The policy would cost the Civil Aviation Operational Fund NT$200 million (US$6.7 million) a year, she said.

Meanwhile, Shen said that the administration would continue to subsidize residents in remote areas and outlying islands for the purchase of flight tickets and would consider increasing these subsidies.

“What the ministry approved was the price cap. We still need to see what tickets will actually cost after the price cap is approved. Then we can determine how much the subsidies will be,” Shen said.

Based upon the administration’s plan, the biggest price increase would apply to flights between Taipei and Kinmen, the cost of which would rise by between 10 and 20 percent. The price of flights between Magong (馬公) in Penghu County and Kinmen would increase by 5 percent, while the cost of flights between Taipei and Hualien would increase by less than 10 percent. Among the 24 domestic flight routes, ticket prices would increase by between 5 percent and 20 percent.

The administration will introduce the new pricing scheme in three stages over the course of a year.

Currently, the administration spends NT$600 million a year subsidizing residents of outlying islands for return flight tickets, accounting for between 30 percent to 40 percent of the ticket price.