AirAsia holds off hike in air fares

Philippines AirAsia Inc. has decided not to raise air fares amid moves by local airlines to hike ticket prices in line with soaring fuel costs.

AirAsia announced yesterday that it would not add fuel surcharge on its domestic and international fares as part of “staying true to its commitment to provide unparalleled low fares.”

“To help reduce travel cost and stimulate more demand for travel and tourism, we will not be adding fuel surcharge on our fares for all domestic and international flights. We want to keep our fares low to encourage more people to travel,” AirAsia Philippines chief executive officer Dexter Comendador said.

“We are closely monitoring the impact of high oil price on our operations, however, we are also working hard to offset the sharp jet fuel costs by adopting cost efficient measures across the network or within the AirAsia Group,” Comendador added.

Last month, the Civil Aeronautics Board (CAB) approved the guidelines on the imposition of the passenger fuel surcharge for domestic and international flights.

The CAB also adopted a matrix for fuel surcharge that will be determined based on the two-month average of jet fuel MOPS (Mean of Platts Singapore) prices in its peso per liter equivalent and will be fixed for two months.

Based on the published and approved matrix, fuel surcharge rates for domestic flights are divided into five categories, depending on the flight distance. These are from 0 to 200 kilometers (km), 201 to 400 km, 401 km to 600 km, 601 to 800 km, 801 km to 1,000 km, and more than 1,001 km.

Meanwhile, for international flights originating from the Philippines, groups are divided into seven, namely: 1) Taiwan, Hong Kong, Vietnam, Cambodia, Brunei; 2) China; 3) Singapore, Thailand, Malaysia, Guam; 4) Indonesia, Japan, South Korea, Port Moresby; 5) Australia, Middle East 6) New Zealand, Honalulu; and 7) North America, United Kingdom.

Under the matrix, domestic air fares could be slapped with an additional cost of up to P769, while those for international flights by as much as P9,860 with the reimposition by local carriers of the fuel surcharge.

Officials of Philippine Airlines and Cebu Pacific earlier said their companies on Sept. 19 started imposing fuel surcharge, which is included in the prices of tickets.

The fuel surcharge is a way in which airlines can partially recover losses from the soaring fuel prices and the weakening of the peso against the dollar.

AirAsia currently operates a fleet of 20 aircraft with flights to and from Manila, Cebu, Clark, Davao, Tacloban, Puerto Princesa, Iloilo, Tagbilaran and Kalibo/Boracay including international flights to Kuala Lumpur, Kota Kinabalu, Hong Kong, Macau, Shanghai, Shenzhen, Guangzhou, Ho Chi Minh, Bali, Taipei, Singapore, Seoul/Incheon and Bangkok.

The company said it is set to launch new flights to and from Cagayan de Oro and Kaoshiung in Taiwan on Oct. 28.