Prepare to increase air service prices

The Airports Corporation of Vietnam (ACV) has just proposed to adjust and shorten the roadmap for increasing aviation service prices to have additional capital to reinvest in airport infrastructure.

ACV proposed to reduce domestic passenger service prices to 3 stages (instead of 4 stages according to the consensus of the Ministry of Transport and the Ministry of Finance).

According to ACV, in the period of 2016 - 2020, the total investment in airport infrastructure is about 31,670 billion VND, of which the total capital demand expected to be disbursed in this period is 22,143 billion VND. The average annual investment capital demand is more than 5,600 billion VND/year.

However, with an average after-tax profit for the 2017-2020 period expected to be around VND2,500 billion/year, ACV will not be able to meet the capital investment needs for upgrading and expanding airport infrastructure. Therefore, adjusting aviation service prices to create investment sources for aviation infrastructure, focusing on the 2017-2020 period, is extremely urgent.

In addition, ACV proposed to reduce domestic passenger service prices to 3 stages (instead of 4 stages according to the consensus of the Ministry of Transport and the Ministry of Finance).

Specifically: From October 1, 2017, increase from 70,000 to 75,000 VND/passenger (increase 5,000 VND/passenger); from January 1, 2018, increase from 75,000 to 85,000 VND/passenger (increase 10,000 VND/passenger); from July 1, 2018, increase from 85,000 to 100,000 VND/passenger (increase 15,000 VND/passenger).

Such an adjustment will increase revenue to VND1,148 billion (an increase of VND105 billion), without affecting airlines, but passengers will have to pay an additional VND25,000/ticket/way.

According to Hanoi Moi Newspaper