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Airline enter high season as fuel prices rise
Latest Updated by 2006-04-11 10:14:19
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Airline enter high season as fuel prices rise
High Season for Chinese Airlines and Fares Rise

STARTING yesterday (Apr 10) air travelers in China have to pay up to 20 yuan (US$2.50) in surcharges as airlines find new ways to cope with rising fuel prices.

Chinese airlines will welcome the high season despite the fuel surcharges, which are in place until October. The six months will include two of China's "golden week" holidays: the May Day and National Day vacations.

Passengers will be charged an extra 10 yuan on flights less than 800 kilometers, and 20 yuan over that, according to the new regulation jointly issued by the National Development and Reform Commission and the General Administration of Civil Aviation of China.

China consumes about eight million tons of aviation fuel every year. When the price rises 300 yuan per ton, the total cost will increase 2.4 billion yuan.

The price rise this time will benefit Chinese airlines, thus reducing the impact of high fuel cost.

Supply generally exceeds demand in China's passenger transportation market since so many airlines have to compete on the ticket prices.

Facing the high fuel situation, airlines adopted a strategy to save fuel. China Southern Airlines has set a goal to save 200 to 300 million yuan in fuel costs to cover the price rise.

China Eastern Airlines will introduce 25 new aircraft this year, many of which have low fuel consumption.

Some airlines have reduced the number of magazines on board and the weight of cabin food trolleys.

Last year, Air China recorded a profit of 2.92 billion yuan, thanks to restrictions of flying heights and speeds to save fuel, said Li Jiaxiang, president of Air China.

Tourism industry experts said the increase in fuel prices failed to cause an instant reaction by tourists and it was natural for airlines to save fuel in order to control costs.

Editor: Wing

By: Source: China View website
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