More than 10 airlines increased fuel surcharges Tuesday as much as 50 percent on international flights originating from the Chinese mainland and Hong Kong, but analysts expect the impact on the aviation industry's recovery to be negligible.
The airlines, which include Cathay Pacific, Singapore Airlines, Air China and China Southern, have adjusted rates differently.
Air China increased the surcharge from 200 yuan ($29.30) to 300 yuan ($43.94) on flights to Singapore and Thailand, and the fuel add-on for Cathay Pacific on short flights shorter than five hours will rise from HK$71 ($9.16) to HK$75 ($9.68), and flights over five hours will jump from HK$328 ($42.32) to HK$348 ($44.90).
Also, beginning December 14, Asiana Airlines will bump up the surcharge on flights from the mainland to South Korea and Japan from 200 yuan ($29.30) to 250 yuan ($36.62), and the extra fee on flights to Europe and Australia will increase from about 500 yuan ($73.24) to 600 yuan ($87.89).
The increases followed the reinstatement of fuel surcharges two weeks ago after domestic airlines cancelled the fees on domestic flights earlier this year as fuel prices dropped.
"The hike is mainly driven by the soaring price of oil," said Yao Jun, an analyst from China Merchants Securities. "Currently, the fuel surcharge on international flights is adjusted according to market changes, and it is normal to see increases if oil prices rise," said Yao.
Last month, the country's regulator increased retail fuel prices in the wake of rising international oil prices, driving up retail fuel costs by 480 yuan ($70.3) a ton, with gasoline increasing 0.36 yuan ($0.05) per liter and diesel rising 0.41 yuan ($0.06) per liter. Jet fuel accounts for 40 percent of the total expenditure of most airlines.
Normally, international flights' fuel surcharges fluctuate with changes in exchange rates and oil prices, said an anonymous industry insider.
However, analysts said fuel surcharges would not stymie the recovery of international flights.
"The increase is still small compared with the total cost of the tickets," said Ma Xiaoli, aviation analyst from CITIC Securities. He added the holiday season, which covers Christmas, the New Year's Day and the Spring Festival, is approaching, meaning there should be solid demand for plane tickets.
The aviation sector entered a period of recovery this summer that appears likely to continue into the near future.
Figures from the Civil Aviation Administration of China show international flights have registered positive growth since July, with October statistics revealing the passenger transport volume of international flights were up 7.2 percent year-on-year, and the cargo volume rose 21.9 percent over last year.
From Global Times
