Asia-Pacific airlines should cut fuel surcharges: Aviation group
Asia-Pacific airlines should cut fuel surcharges: Aviation group
Agence France-Presse, Singapore
Airlines should consider cutting their fuel surcharges on passenger tickets in the face of slowing travel demand and concerns over bird flu, the Center for Asia-Pacific Aviation (CAPA) said on Wednesday.
Executive chairman Peter Harbison said he will push the message in the annual aviation outlook summit which will be held in Kuala Lumpur next month.
He noted that some freight carriers have already started to ease their surcharges to reflect lower jet fuel prices.
"But passenger airlines appear reluctant to move on passenger fuel surcharges," he said in a statement.
"Yet the longer they hold off, the more they risk hurting forward demand, which is looking decidedly fragile in some markets.
"In some markets, fuel surcharges are actually making passenger bookings less predictable, which is leading carriers into the perverse situation where they are discounting underlying fares to fill their aircraft."
He said another concern weighing on demand was the fear of bird flu, which has hit several countries in the region, such as China, Vietnam and Thailand.
One carrier, China Southern Airlines, has already warned that the impact of bird flu worries on travel is expected to be seen in November's traffic data.
"Reducing surcharges would provide a needed boost to travel demand, especially if the global economy continues to slow," Harbison said.
The summit in Kuala Lumpur is also expected to be a platform for governments to respond to an "open skies" agreement between the European Union and the United States.
Such an agreement could mean rights for carriers to fly beyond the territory of the other to destinations in Asia, said CAPA, a specialist consultancy group focused on the aviation industry.
Harbison warned the region must be ready.
"Asia-Pacific airlines could be vulnerable to competition with carriers many times their size," he said.
"The options for Asia could include consolidation, reversion to government ownership and/or mergers at the domestic level -- all options will be on the table."