The Airport Council International (ACI) – Asia Pacific in collaboration with Flare Aviation Consulting has published a report on airfare trends. The study included 36,000 routes in the top 10 aviation markets in Asia-Pacific and revealed an alarming increase in international airfares by up to 50%, while domestic routes went up by less than 10%.
The markets with highest airfare increase were India at 41%, United Arab Emirates 34%, Singapore 30% and Australia 23%.
The report highlights the fact that despite a progressive increase in traffic, domestic airfares have continued to increase in markets like India, Indonesia, Saudi Arabia, South Korea and Japan, only decreasing marginally on international routes.
Expressing concerns about the high-pricing practice, Stefano Baronci, director general of ACI Asia-Pacific, said: “These excessive airfares threaten the industry's long-term recovery and may have a far-reaching influence on the associated industry by reducing demand for air travel and increasing the financial burden on the already stressed sector. Airlines should exercise fair pricing that supports recovery and safeguards consumers’ interests. A supply-demand imbalance should not be exploited by airlines at the expense of customers by restricting the capacity, especially international one which is a key driver of social and economic growth and a major source of revenues for the airport sector. We urge airlines to carefully consider the long-term impacts of their pricing decisions. At the same time, Governments must consider liberalising markets through policies such as open skies, which will allow competition while keeping airfares under control.”
The report also pinpointed at how the airlines are capitalising on low competition and pent-up demand to increase profits and recover losses incurred during the pandemic, while airports continue to provide enhanced services to passengers despite incurring heavy operational and capital expenditures.
All-in-all the report draws a comparison between airports that have maintained steady charges since the pandemic while airlines have increased the air fares even after reaping huge profit margins.