surfdude Posted May 29, 2008 Report Share Posted May 29, 2008 I thought it may be interesting to hear peoples views on this topic. I have been wondering how much longer air travel will be affordable. I live in HK and the price of air tickets has gone up steeply and I don't see this about to change anytime soon. The tickets I have bought to go away this summer on Continental are about 35% more expensive than they were 2 years ago. When our local budget long haul carrier Oasis went suddenly bankrupt last year I took this to be a bellweather of bad tidings ahead for the air industry. Airlines are having to cope with huge spikes in fuel charges which are in turn passed onto the consumer. This article outlines the situation: From the Earth Times, Wed, 28 May 2008 Hong Kong - Nearly 50 airlines were Wednesday preparing to add hefty surcharges to flights out of Hong Kong from next week after applications for bigger fuel surcharges by 34 more airlines were approved. The move by airlines including British Airways, Qantas, Air France and China Airlines follows successful applications by 13 other airlines earlier this week to raise fuel surcharges by up to 37 per cent. The territory's Civil Aviation Department approved the increased surcharges, the biggest increases ever seen in the city of 6.9 million, because of the sharp rises in oil prices. Flights out of Hong Kong will from next Monday cost an average 52 US dollars more for a short haul flight and 133 US dollars more for a long haul flight. The increased surcharges have initially been approved until July 31. Tony Tyler, chief executive of Hong Kong's flagship airline Cathay Pacific which was among the first airlines to apply for the increase, said earlier this week fuel prices rises were "posing an enormous challenge to the aviation industry." Jet fuel prices now accounted for 40 per cent of Cathay Pacific's net operating costs compared with just 30 per cent in 2007, he said. The cost of flying a jumbo jet to London and back from Hong Kong now costs 360,000 US dollars in fuel alone. __________________ US$360,000 in fuel for return flights to London! This doesn't include their other operating costs. With about 350 seats on a Jumbo how much money are they making? London to HK is a highly competitive route and you can often get seat sales for less than US$600. I wouldn't be surprised if carriers start dropping routes that aren't profitable and bring steep increases in fares. Cathay has been promoting its new flash interiors recently and has started to receive the more fuel efficent 747-400ER. So they are trying to offer a better product and save on costs but it is going to cost the consumer more to use their service. I think it will go particulary bad for carriers in the US. However, I do see the potential for growth in China's market and I remember reading that the government has made it easier for mainlanders to obtain passports and get visas for travel. Link to comment Share on other sites More sharing options...
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