Airport service prices increase, will airfares increase?

After the roadmap for increasing airport service prices was announced (from October 1), some agents demanded to increase airfares, with some agents increasing the price by about 500,000 VND/ticket. Meanwhile, aviation authorities said that the ticket price had increased but only by a few tens of thousands of VND/ticket, and warned passengers to avoid being taken advantage of by agents who increase prices.

Maximum increase of 30,000 VND/customer

The Ministry of Transport has just decided to increase the prices of some specialized aviation services (these prices have been maintained for 5 years) to offset the cost of investing in the airport system, improve service quality... Accordingly, during normal hours, the take-off and landing prices applied in the period from October 1, 2017 to June 30, 2018 will be adjusted up 5% compared to current regulations. From July 1, 2018, it will increase by 10%. The price collected during peak hours will be equal to 115% of normal hours while during off-peak hours, this figure is only 85%.

Also from October 1, the price of aviation services for each passenger will also fluctuate. Accordingly, the price of passenger services for international flights will remain the same. For domestic flights, the price of passenger services will be adjusted to increase in 4 stages.

In phase 1 (from October 1, 2017 to December 31, 2017), the fee applied to group A airports is 75,000 VND/passenger, group B is 70,000 VND/passenger (an increase of about 7% compared to current); group C remains the same as current at 60,000 VND/passenger. In the final phase (after June 30, 2018), the highest fee applied at group A airports is 100,000 VND/passenger, group B is 80,000 VND/passenger and group C is 60,000 VND/passenger.

In addition, from October 1, the price for aviation security screening services will be applied at 2 USD/international passenger (currently 1.5 USD); for domestic passengers, from October 1, 2017 to December 31, 2017, the new price will be 11,818 VND/passenger compared to the current price of 9,090 VND.

Mr. Lai Xuan Thanh, Chairman of the Board of Directors of the Airports Corporation of Vietnam (ACV), said that for a long time, airlines have benefited greatly from using infrastructure and cheap services invested by the budget. And the price change is to distribute profits between the parties.

The increase in service prices will cost passengers more when traveling by plane.

Accordingly, with the new air fares, Vietnam Airlines will have to increase costs by VND87.75 billion, Vietjet Air by VND55.41 billion and Jetstar Pacific Airlines by VND18.38 billion. If the entire additional cost (VND161.53 billion) is "allocated" to the ticket price, the cost for a ticket will only increase by VND4,531. The average domestic passenger service and security price for a passenger will increase by VND25,854. Thus, the total additional cost that passengers must pay for a flight ticket is VND30,385.

The leader of the Civil Aviation Authority said that after adjusting services, airlines must recalculate and restructure the airfare range appropriately, but still must not exceed the current ceiling price to limit the impact on customers.

Be alert to the dealer's price gouging tricks.

Although not yet officially applied, for several months now, many agents have announced to customers at the counter, even publicly on the internet, the increase in ticket prices and suggested that customers buy tickets early to avoid the price increase. The price increase announced by agents fluctuates at 100,000 VND/economy and low-cost flight ticket; for business class tickets, some agents "threaten" to increase up to 500,000 VND.

Through discussions, airlines said that they have not yet issued plans to increase ticket prices. Vietjet representatives said that tickets are made up of all types of taxes and airport fees. Therefore, when taxes and fees increase, ticket prices will naturally increase. "When airlines increase ticket prices, they are just collecting on behalf of the authorities. The airline encourages passengers to buy tickets directly online and avoid buying from unofficial ticket agents of the airline to avoid buying tickets at prices higher than the airline's regulations," said Vietjet representative.

Airline passengers need to be careful of price gouging by agents during the increase in air service prices.

Jetstar Pacific representative also said that “increasing one thing will lead to increasing another” in accordance with market principles. “With the current way of selling tickets, the increase in airfare will not affect the price of the airline’s tickets much. Specifically, Jetstar Pacific is selling 12-13 prices, from low to high for each flight. There will be tickets sold below cost and tickets sold above cost.

This fee increase will affect the ticket price more or less, but not much, the airline may only adjust the average ticket price up a little. In which, the cheap ticket range may have to be adjusted to have fewer sales" - this person said.

According to Tien Phong Newspaper