Aviation fuel surcharge may be reinstated: report

By Zuo Maohong

The resumption of a fuel surcharge for passenger flights is possible following a hike in aviation fuel prices last week, according to a media report Friday.
 
Yangcheng Evening News (YEN) reported that two major airlines had issued calls for the reintroduction of fuel surcharges to weather rising fuel costs.

Chinese authorities canceled fuel surcharges six months ago in response to aviation fuel price cuts.

The National Development and Reform Commission raised the price of aviation fuel Tuesday. The price of No. 3 jet fuel, which is most widely used in passenger planes, increased from 4,020 yuan ($588.40) a ton to 5,020 yuan ($734.78) a ton, up 25.6 percent.

Xu Jianqiang, secretary of the Commercial Commission of Air China, was quoted by YEN as saying that higher aviation fuel prices have increased costs for airlines and it is natural that airlines request the resumption of fuel surcharges.

China Southern (CSN) is applying for the re-launch of the surcharges, the YEN report quoted CSN president Si Xianmin as saying.

Customer service representatives from Air China, China Eastern and CSN all told the Global Times yesterday that they had received no word from the top regarding the possible resumption of fuel surcharges.

No official announcement has been issued by the Civil Aviation Administration of China as of press time of the Global Times.

In the first quarter of the year, Air China and CSN reported a year-on-year drop of 5.68 percent and 71.32 percent in net profits, according to the companies’ quarterly fiscal reports on the Shanghai Stock Exchange website.

The country’s four biggest airlines posted a total loss of over 29 billion yuan ($4.24 billion) in 2008.

According to many airlines’ 2008 annual reports, fuel costs contributed heavily to their bottom line. China Eastern’s fuel costs increased by more than 20 percent year-on-year due to oil price hikes.

Explore the World, Understand China!
Please log on www.gloaltimes.cn