Vietnam airlines pitch for higher fares

Vietnam’s carriers will need to increase its domestic fares by up to 22.7 percent in order to counter losses with the rising cost of fuel, a Finance Ministry said.

The Ministry’s director of price control Nguyen Tien Thoa said airlines are currently seeking approval to increase their fares by 20 to 50 percent, Thanh Nien reported.“We think it’s reasonable that they want to raise the prices. What we are still considering is how much the hike should be and when it should take effect,” Mr Thoa said.

According to the source, Vietnam petitioned for the government to lift the domestic fare cap as well as a complete cap removal over the next four years.Currently Vietnamese airlines are restricted by the cap which limits 300 kilometre airfare to VN$682,000 while airfare for up to 500 kilometre is capped at VN$864,000.

Flights over 500 kilometres are limited to charge VN$1.18 million while over 850 kilometres can charge VN$1.81 million.Mr Thoa said the government is considering lifting the cap on routes services by more than one airline.

Source = etravelblackboard.asia