Airfare discounters get another reprieve
Airfare discounters get another reprieve
JAKARTA (JP): For the second time, the working group of five
scheduled domestic air carriers failed to reach an accord, thus
delaying the imposition of sanctions for excessive airfare
discounting, an industry executive says.
Chairman of the Indonesian Air Carriers Association (Inaca),
Soelarto Hadisoemarto, said the working group -- comprised of
Garuda Indonesia, Sempati Air, Merpati Nusantara Airlines,
Mandala Airlines and Bouraq Indonesia Airlines -- assigned to
decide the sanctions policy, has held several inconclusive
meetings since early this year.
Soelarto told The Jakarta Post here during an Idul Fitri
gathering with the Indonesian Hotel and Restaurant Association
(PHRI) Friday evening that airfare price wars, therefore, will
likely continue, much to the delight of conspicuous consumers.
"We hope the group can decide on the sanctions policy by the
middle of this month so that the regulation can take effect soon
afterwards," he said.
The regulation was originally scheduled to take effect on
March 1.
"The members of the working group, chaired by Sempati's
president, Hasan M. Soedjono, are apparently busy with private
business related to the recent Idul Fitri holiday," Soelarto
hypothesized.
He acknowledged that the working group was still arguing about
the levels of fines to be imposed on carriers offering excessive
discounts.
He also said that at the time of the first delay last month,
the minutes of some of the group's meetings were not signed by
all members of the group as they were on overseas assignments.
Under the prepared regulation, domestic air carriers are
supposed to pay a fine of dozens of millions of rupiah if they
are found discounting airfares by over nine percent for
international flights and seven percent for domestic services.
Currently, air carriers routinely reduce ticket prices by
between 15 and 40 percent. The government has been urging
domestic carriers to end the fierce price discounting wars since
last year. (icn)