Observer: Revision of Flight Ticket Price Ceilings Appropriate for Flight Operations

Jakarta (ANTARA) - Aviation observer Alvin Lie believes the government’s move to adjust the upper fare limit (TBA) for flight tickets is an appropriate and urgent policy to address the changing economic and operational conditions of the current aviation industry. According to Alvin, the current TBA regulation is approximately seven years old and no longer reflects the actual costs faced by airlines. Therefore, updating the policy is considered essential for the industry to operate in a healthier and more sustainable manner.

“The TBA must be adjusted because it has been in place for seven years and no longer aligns with current economic conditions. As a result, we are relying on fuel surcharges to offset the imbalance in airline operating costs,” Alvin stated when contacted by ANT_ARA in Jakarta on Sunday.

Alvin made these remarks when asked about the revision of flight ticket price ceilings, which is currently being processed by the Ministry of Transportation. Due to this discrepancy, the aviation industry has relied heavily on fuel surcharge instruments to help cover rising operational expenses. However, according to Alvin, such instruments are fundamentally intended only for specific circumstances, such as during periods of volatility in aviation fuel (avtur) prices.

Alvin revealed that in February 2024, he submitted an official letter to the Directorate General of Civil Aviation of the Ministry of Transportation proposing the removal of the fuel surcharge. This proposal was submitted in his capacity as the Chairman of the Indonesian Aviation Service Users Association (APJAPI), based on the fact that avtur prices had returned to levels seen before the Russia-Ukraine conflict.