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Higher Insurance Charges Push Up Air Tickets
China's airlines are to increase their international ticket prices by US$2.5 per person starting from Monday, in response to increasing insurance charges handed out to international air services, according to today's China Daily.
International insurance bearers have increased aircraft insurance charges, following the terrorist attacks in the US on September 11, which have brought many insurance companies to the verge of collapse.
The General Administration of Civil Aviation of China £¨CAAC£©, the industry watchdog, informed domestic airlines about the decision to increase ticket prices last week.
"It will help airlines survive international competition at a crucial time," said an official with the Financial Department of the CAAC.
He said the more expensive tickets will affect passengers leaving China to travel abroad. The price increase will also affect people who want to travel to Hong Kong and Macao.
The official believes that the US$2.5 increase has been enforced in an effort to bridge the gap of increased insurance fees and operation costs.
Sources with the three biggest airlines - Air China, China Southern Airlines and China Eastern Airlines, confirmed that they will also increase international ticket prices by US$2.5 starting today.
Su Haitao, an insurance official with Air China, said in an telephone interview that his company had informed all ticket offices of the new, increased price.
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