Air Fare Hike Gets Mixed Response

Chinese airlines have reacted differently to an announcement nearly a month ago by the Civil Aviation Administration of China (CAAC) that airfares should increase.

Air China, China Southern Airlines, China Southwest Airlines and Sichuan Airlines announced on Wednesday that they would not sell airline tickets with a discount of more than 10 per cent to group and individual travellers in or out of Sichuan Province.

They said the measure was aimed at stopping cut-throat competition which could affect business to and from popular tourist spots in southwest China.

Officials with Air China, who asked not to be named, said it was strictly following the new regulation of CAAC, which it expects will increase profits.

But Zhejiang Airlines has announced a 20 per cent price cut between Hangzhou and Wenzhou. The price has dropped to 400 yuan (US$48) for a one-way trip from 500 yuan (US$60).

Though the lower price was only available on some 52-seat passenger planes, there was still an increase in passenger numbers.

Sources close to the airline said that strong competition from China Southern Airlines, which also operates along the same route, was the key factor behind its move.

CAAC sources indicated that the high prices, which were brought in because of rising world oil prices this year, were expected to continue until early next year.

The administration recently notified domestic airlines again to up prices and told them no discount tickets must be offered.

There is only one exception to this rule -- a 50 per cent discount can be offered to disabled soldiers and policemen on domestic air routes.

From December 1, they will be able to buy half-price tickets, although they must do so three days before travelling.

In another development, Air China and Shanghai Airlines Co Ltd recently signed an agreement to enhance their co-operation in code sharing, repairing planes and in the use of airports.

Under the agreement, regular passengers from either company will have the right to enjoy preferential treatment with both airlines.

The two firms say they have 250,000 regular passengers.

Air China is expected to launch promotional activities in the near future following this month's appointment of Wang Kaiyuan, former vice-minister of CAAC, as president of the state-owned aviation giant.





Source: chinadaily


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