Flying high with cheaper airfares

Flying high with cheaper airfares

Hendarsyah Tarmizi, The Jakarta Post, Jakarta

Passengers from Indonesia to several major cities in Asia and
Australia can now get cheaper airfares thanks to special sales
campaigns launched by several major regional airlines.

In a special sales promotion, which will be effective until
Oct. 31, Singapore Airlines (SIA), is selling return tickets for
the Jakarta-Singapore route for as low as US$99 to $129,
depending on flight schedules.

In addition to the Jakarta-Singapore route, SIA is also
offering special rates for several other cities in Asia and
Australia, such as Kuala Lumpur, Saigon, Bangkok, Hong Kong,
Taipei, Canton, Shenzen, Amritsar and Perth.

Although conditions must be met for the special fares, they
are quite lower than normal rates, the public relations manager
of SIA's Indonesian office, Glory Henriette, said.

"The special offer has been launched to take advantage of the
growing passenger traffic in the region," she said.

The airline's main competitor in Asia, Cathay Pacific, has
launched a similar sales promotion to lure more passengers. The
airline special airfare promotion will be valid until Nov. 9.

Cathay's round-trip tickets for Jakarta-Singapore sell for as
low as $85, while tickets for Jakarta-Hong Kong go for just $368,
a little less than the $499 charged by SIA.

The two airlines said the special rates were not intended to
retain their loyal customers from the lure of budget airlines,
which have successfully captured the hearts of many frequent
fliers in the region thanks to their low fares.

No-frill airline Air Asia's one-way ticket between Jakarta and
Johor (Malaysian city near Singapore), for instance, sells for Rp
88,000 (about US$10), while a ticket from Jakarta to Kuala Lumpur
costs Rp 242,000.

SIA's Henriette said that SIA, which is known for its
excellent in-flight service and modern aircraft, had suffered
very little effect from the presence of the budget airlines.
"Both airlines have their own markets," she said, adding that the
SIA has already operated its own budget airline Tiger Airways to
tap this particular market segment.

Besides offering special rates, the region's airlines also are
cooperating with travel agencies to attract passengers, such as
by offering special package tours to famous tourist
destinations .

"To capture business and leisure traffic to Hong Kong, we, for
example, offer special tour packages such as Hong Kong Super
City, Hong Kong Super Stop and Hong Kong Super Asia," the public
relations manager at the Jakarta office of the Hong Kong-based
Cathay Pacific, Ida Sylviana Bekti, said.

Like SIA and Cathay, other large carriers in the region such
as the Taipei-based Eva Air also have introduced special packages
to attract Indonesian travelers.

Eva Air, for instance, is cooperating with Jakarta-based
travel agencies Mutiara Indah, and PT Dwidaya Tour and Travel to
arrange special tour packages to major tourist destinations.

"In a bid to increase the number of passengers, we have
created more affordable tour packages both for individual and
group travelers to Taiwan, the United States and Europe," Makmun
Hamsa, the general manager of Eva Air's Jakarta office, said.

The value-added services provided by the airlines have partly
contributed to an increase in passenger traffic in the Asia
Pacific, which continues to rebound from the traumatic impact of
the SARS in 2003.

The International Air Travel Association (IATA) reported
recently an 18.7 percent increase in international passenger
traffic and a 14.2 percent increase in international cargo
traffic for the first eight months of this year over the same
period in 2003. Passenger traffic in Asia alone rose by 29
percent in the same period.

"The increase in traffic is well beyond our expectations. It
will not mitigate the high cost of fuel but it is a much needed
shot in the arm for a beleaguered industry," said IATA's director
general, Giovanni Bisignani, in a recent press statement.

The high growth figures for the January to August period are
partially exaggerated by the comparison to the same period in
2003, which was severely depressed due to the SARS crisis.
Nonetheless, indications of healthy traffic growth are clearly
evident in the August performance.

"Year-on-year for August, passenger traffic grew by 10.8
percent, while freight was up 13.6 percent," Bisignani said,
adding that the passenger load factor globally remained at a
relatively high 78.3 percent for the month of August, although
many airlines have increased their capacity.

SIA said in a recent report that the airline carried 1.37
million passengers in August, an increase of 8 percent from 1.26
million in 2003.

The airline said that it filled 75.9 percent of its passenger
seats in August, down from 78 percent in July and 81.7 percent
last year, partly due to an increase in passenger seat capacity,
which rose 7.2 percent in the same month.

Cathay said that it carried 1.27 million passengers in July, a
one month record -- up from 1.14 million passengers in June.
Compared to the same month last year, the number of passengers in
July rose by 45 percent.

IATA, however, warned that the increase in fuel prices would
undercut the airlines' higher earnings.

Although air carriers in Asia have not made significant
adjustments to their airfares in light of the high fuel costs,
most of them had introduced fuel surcharges of between $4 and
$12, depending on destination.

SIA, which flies to Jakarta, Surabaya and Denpasar, imposes,
for example, a fuel surcharge of $4 for flights between Singapore
and Kuala Lumpur, $7 for flights between Singapore and other
Southeast Asian cities, and $12 for all other flights.