Ministry of Transportation Explains Reasons for High Airfares
The Ministry of Transportation (Kemenhub) believes public complaints about expensive airfares during the exodus season are caused by indirect or transit flight bookings rather than direct routes.
“From what we see in social media coverage, the high prices are actually because the flight tickets are not direct. For example, a ticket that should be Cengkareng-Padang but goes through Yogyakarta,” said Agustinus Budi H, Director of Air Transport at the Ministry’s Directorate General of Transportation, during an online press conference in Jakarta on Tuesday.
Under this scheme, airfares tend to be more expensive as they fall outside the Maximum Fare Ceiling (TBA) framework designed for direct flights. Agustinus noted that the current TBA rules have been in place since 2019, pursuant to the Ministry of Transportation Decree Number KM 106 of 2019 concerning Maximum Fares for Domestic Scheduled Commercial Air Transport Services in Economic Class.
At that time, the rupiah exchange rate was approximately Rp14,000 per US dollar with aviation fuel costs around Rp10,000. Currently, with the rupiah exchange rate approaching Rp17,000 per US dollar, aviation fuel costs have reached Rp16,000.
“Mathematically, this should also change, because our country applies both a maximum fare ceiling and minimum fare threshold. This is why airlines during peak seasons will certainly apply fares according to the TBA,” he explained.
The Ministry of Transportation regularly monitors airfares through calculations based on the TBA plus value-added tax (VAT), passenger service charges (PSC), mandatory levies, and fuel surcharges. From monitoring conducted primarily at Soekarno-Hatta Airport in Tangerang, ticket prices sold conform to applicable regulations.
The Ministry acknowledges the need to focus on airfare affordability for the public, but also recognises the importance of ensuring airline business viability. Accordingly, the Ministry continues to discuss operational costs with airlines, including the gap between the 2019 TBA calculations and current airline operating conditions.