Travelers hit as airlines hike fuel fees
By Winny Wang |
April 8, 2011, Friday
|
Print Edition
Print Edition
MOST Chinese mainland airlines started to raise fuel surcharges yesterday as they pass on the rising fuel costs to passengers after the government increased the ex-factory price for jet fuel by 500 yuan a ton to 6,840 yuan.
Air China, China Eastern Airlines and other major domestic carriers increased fuel surcharges to 110 yuan from 90 yuan on routes longer than 800 kilometers, and fuel surcharges to 60 yuan from 50 yuan on other routes, according to China's leading travel service provider Ctrip.com.
The National Development and Reform Commission yesterday raised the gasoline price by 500 yuan a ton, diesel by 400 yuan a ton and jet fuel by 500 yuan a ton after international crude prices surged to their highest level in two-and-half years following upheaval in Libya and other Middle East nations.
"The jet fuel increase will cost Air China 730 million yuan, China Southern Airlines 1.24 billion yuan, and China Eastern 1.06 billion yuan," said Huang Jinxiang, an analyst at Sinolink Securities Co.
"The fuel surcharge increase will generate 560 million yuan for Air China in revenue this year, 910 million yuan for China Southern and 730 million yuan for China Eastern," Huang said.
In 2009, the NDRC, the country's top economic planning agency, introduced a mechanism that links fuel surcharges on domestic air routes with fuel costs to better reflect price movements. The jet fuel cost is calculated at the weighted average of ex-factory price jet fuel and imported price of fuel.
Air China, China Eastern Airlines and other major domestic carriers increased fuel surcharges to 110 yuan from 90 yuan on routes longer than 800 kilometers, and fuel surcharges to 60 yuan from 50 yuan on other routes, according to China's leading travel service provider Ctrip.com.
The National Development and Reform Commission yesterday raised the gasoline price by 500 yuan a ton, diesel by 400 yuan a ton and jet fuel by 500 yuan a ton after international crude prices surged to their highest level in two-and-half years following upheaval in Libya and other Middle East nations.
"The jet fuel increase will cost Air China 730 million yuan, China Southern Airlines 1.24 billion yuan, and China Eastern 1.06 billion yuan," said Huang Jinxiang, an analyst at Sinolink Securities Co.
"The fuel surcharge increase will generate 560 million yuan for Air China in revenue this year, 910 million yuan for China Southern and 730 million yuan for China Eastern," Huang said.
In 2009, the NDRC, the country's top economic planning agency, introduced a mechanism that links fuel surcharges on domestic air routes with fuel costs to better reflect price movements. The jet fuel cost is calculated at the weighted average of ex-factory price jet fuel and imported price of fuel.
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