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Wednesday, June 19, 2024

Vietnam to raise domestic air ticket price caps next month

By Nguyen Tan

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HCMC – The Ministry of Transport has announced the caps on domestic air ticket prices will increase by VND50,000 to VND250,000 per ticket compared to the current levels.

Circular 34/2023/TT-BGTVT, which revises the framework for passenger transportation service prices on domestic air routes, will take effect from March 1, 2024.

Routes covering less than 500 kilometers will have a price cap of VND1,600,000 per ticket for socio-economic development routes and VND1,700,000 per ticket for other routes.

For longer routes, price increases will vary between VND50,000 and VND250,000 per ticket depending on the length of each route.

Flights ranging from 500 kilometers to less than 850 kilometers will have a ceiling price of VND2,250,000 per ticket while those from 850 kilometers to less than 1,000 kilometers will be capped at VND2,890,000 per ticket.

The highest prices for flights from 1,000 kilometers to less than 1,280 kilometers and those from 1,280 kilometers and above will be set at VND3,400,000 and VND4,000,000 per ticket, respectively.

The Civil Aviation Authority of Vietnam has cited higher fuel costs and volatile foreign exchange rates as reasons for the hike in domestic flight ticket price caps.

Airlines such as Vietnam Airlines, Vietjet, Pacific Airlines, and Bamboo Airways have expressed support for higher air ticket price caps.

Jet fuel costs constitute around 36% of transportation costs, with the average fuel price surging by about 85% from US$67.3 per barrel in 2015 to US$124.4 per barrel in 2022, resulting in a 30.5% increase in airline costs.

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