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Monday, April 14, 2008

 

Costlier summer air travel
looms as jet fuel price rises

By Darwin G. Amojelar, Reporter

AS the Philippines’ summer season kicks off, travelers are likely to fork out a bigger sum for tickets as airlines seek higher fuel surcharges to mitigate the impact of more expensive jet fuel.

In separate applications filed before the Civil Aeronautical Board (CAB), Philippine Airlines and Cebu Pacific, the country’s two leading carriers, sought permission to increase the surcharges on their domestic flights.

The looming fare increase is likely to put a dent on the government’s plan to raise tourism receipts from local travelers especially since a strong peso is expected to turn away US tourists, who accounted for a fifth of total arrivals last year.

 The CAB earlier reported that domestic air travel last year rose to 10.38 million passengers, up 22.7 percent from 8.46 million in 2006. International passenger traffic meanwhile grew 10.85 percent to 11.23 million compared with 10.13 million in 2006.
PAL wants to raise the surcharge on its Luzon-Visayas flights to P1,030 from P930 at present. The surcharges on the Luzon-Mindanao, Visayas-Mindanao, and within Luzon flights would rise from P1,180, P900, and P780 to P1,380, P1,100, and P880, respectively. The surcharge on flights within Mindanao would remain at P1,180.

For its part, Cebu Pacific wants a P1,130 fuel surcharge, up from P1,280 for its Luzon-Mindanao flights. It is also seeking increases in its Luzon-Visayas, Visayas-Mindanao, within Visayas, within Luzon, and within Mindanao surcharges from P970, P900, P650, P700, and P900 to P1,070, P1,000, P750, P750, and P1,000, respectively.

Besides the local carriers, Royal Brunei filed for an increase in its fuel surcharge for its Manila- Brunei flights from $12 to $25. Singapore Airlines also plans to raise its surcharge to $30 from $26 per sector flights between Singapore and other Association of Southeast Asian Nation member-countries, and to $130 per sector flights between Singapore and gateways in the US and Canada.

Silk Air will hike its surcharge to $80 from $75 per sector flights between Singapore and points in China, Taiwan, India and Nepal, and to $30 from $26 between Singapore and the Philippines.

Cathay Pacific Airways Ltd. wants to increase the surcharge to $66.40 from $65.10 for flights between Hong Kong and Southwest Pacific, North America, Europe, Middle East, Africa, South Asian Sub Continent, as well as between Bangkok and Dubai.

Northwest Airlines has applied for a $135 fuel surcharge from $125 each way between the Philippines and North America.

A fuel surcharge is a temporary relief granted to airlines to help them recover losses they incur from higher jet fuel prices. According to the International Air Transportation Association Jet Fuel Price Monitor, the average jet fuel price last year stood at $87 per barrel

Fuel accounts for a third of an airline’s operating cost per passenger, and is the second-highest expense next to labor.
The price of jet fuel started going up in 2002 but local and foreign airlines began asking for an adjustment in their fuel surcharges in 2004.

  
 

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