Passengers boarding a flight at the Ho Chi Minh City’s Tan Son Nhat Airport. Photo: Minh HungThe Central Aviation Authority of Vietnam has asked local airlines to reduce airfares following a fall in aviation fuel Jet A1.
According to CAAV, fuel makes up nearly 40 percent of total costs of the airlines and ticket prices should reduce once fuel prices drops.
Vo Huy Cuong, CAAV deputy director, asked the carriers to sell more low cost flight tickets and more promotions to attract passengers.
Average price for aviation fuel Jet A1 in Asia in August was about US$57 per barrel, a reduction from $85 last December.
Last year, the Ministry of Finance reduces maximum price per kilometer for economy flight tickets to VND4,250 per person from VND5,000, following a drop in fuel price.
However, Le Hong Ha, general director of Jetstar Pacific, said he doesn’t think airfares would reduce significantly because they have been already low due to harsh competition.
“Average ticket price from Ho Chi Minh City to Hanoi, one of the most crowded routes, was up to VND1.2 million (US$53.4) last year but has been reduced to around VND800,000 ($35.6) in August and September.”
“This is very low and can hardly make profit. It is even much cheaper than road and railway transports.”
Vietnam aviation authorities ask carriers to reduce airfares
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