Vietnam’s airlines blame high jet fuel price for pricey airfare
No Vietnamese air carriers were able to make it to the world’s top 50 cheapest airlines, with industry insiders saying they have the domestic high jet fuel prices to blame for their inability to offer really reasonable tickets.
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| An airplane is refilled with petrol at Tan Son Nhat International Airport in Ho Chi Minh City. Photo: Tuoi Tre |
Tigerair from Australia led the list with an average cost per kilometer of US$0.06, followed by Malaysia’s AirAsiaX with $0.07, and AirAsia of Indonesia with US$0.08. Jetstar, a member of Australia’s Qantas Group, ranked fourth with US$0.09.
Six carriers, including the second-largest airline of the United Arab Emirates – Etihad, Indonesia’s Citilink, Iceland's only high performance low-cost airline WOW Air, Oman Air, Indonesian Lion Mentari Airlines and Ryanair from Ireland, closely came after with the same average cost per kilometer of US$0.1.
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| Top 50 airlines by average price (US$) per kilometer by Rome2rio |
In the meantime, all three major Vietnamese carriers, Vietnam Airlines, Viejet and Jetstar Pacific, failed to make it to the top 50.
No-frills Vietjet charges its passengers an average of US$0.14 per kilometer, compared to US$0.15 of its low-cost peer Jetstar Pacific.
National flag carrier Vietnam Airlines had a much higher cost per kilometer ratio, $0.3.
While the three are absent from the Rome2rio list based on the average cost per kilometer ratio, Vietnam ranked 15th in terms of average ticket price by country.
A representative of a Vietnamese airline said that jet fuel is much more expensive in Vietnam than in other countries, resulting in higher airfares, given the fact that fuel accounts for 30%-40% of the total operating costs of a carrier.
“The jet fuel price in Vietnam is 20%-30% higher than in other regional countries,” he told Tuoi Tre (Youth) newspaper.
At its latest shareholders’ meeting, Vietnam Airlines announced that fuel makes up 24-38 percent of the company’s expenses.
Even a one-dollar rise in oil price will lift the cost of the national flag carrier by about VND230 billion (US$10.12 million) a year, according to Vietnam Airlines.
