Price ceiling lifted for local flights

Airfares for domestic air routes will increase by 100,000 VND – 80,000 VND starting March 1, according to a recent decision of the Ministry of Finance
Airfares for domestic air routes will increase by 100,000 VND – 80,000 VNDstarting March 1, according to a recent decision of the Ministry of Finance.

The cap on domestic airline tickets will be applied on four kinds offlights.

New airfares for flights with a distance of less than 300km;300-500km; 500-850km and more than 850km will cost 682,000 VND; 864,000 VND;1.182 million VND and 1.819 million VND, respectively.

With theincrease, the cap for a one-way airfare on Hanoi-HCM City route will go up to2.03 million VND (inclusive of tax and airport fees) from the current 1.811million VND.

Vu Van Chinh, deputy head of the Ministry of Finance’sPrice Mangement Department, said the ceiling on fares had remained unchangedsince 2008 while input costs in the aviation industry fluctuate greatly.

The exchange rate between the US dollar and the local currency alsoaffects the industry’s operation, and there will have to be another adjustmentif the exchange rate fluctuates strongly, he said.

Hoang Thanh Quy,deputy head of Vietnam Airlines’ Sales and Marketing Department, said theairline would launch a wide range of fares, with the highest fares equalliingthe cap of 2.03 million VND and the lowest 25 percent under the cap.

Inaddition, it will also launch promotion programmes during the non-peak travelseason.

The budget airline Jestar Pacifiic applies 12 levels ofairfares, with the highest price at 2.03 million VND.

Currently, VietnamAirlines and Jestar Pacific serve the domestic market./.

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