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Fare Rise Cuts Air Travel


23-Apr-2004 -
The recent 10 percent rise in domestic air fares has cut May holiday plane bookings at least 30 percent, travel agents said yesterday.

But tickets to spots like Yunnan Province's Kunming, a beautiful city that leads to other popular destinations like Lijiang and Dali, are almost sold out for April 30, May 1 and May 2.

Flights to the southern resorts of Hainan and Guilin are also filling fast, but north-bound flights have plenty of seats.

Carriers operating out of Shanghai raised fares about 10 percent from April 20.

"Compared with other week-long holidays like the National Day holiday and Spring Festival holiday last year, tourists planning air trips dropped more than 30 percent, and this is only my initial and very conservative estimate," said Peng Haibin, a sales manager with Shanghai Dazhong International Travel Service.

The prices of tourist packages to destinations like Kunming have risen about 200 yuan (US$24).

Prices to some other destinations are up about 100 yuan, compared with last year's National Day holiday.

"May Day holiday should be the best holiday in a year because of the comfortable weather," said Peng.

To prevent customers retreating, some travel agencies have borne the price rise themselves.

"Because we started to design and promote most of our tourist packages from the beginning of this month, many customers have already signed contracts with us," said Zhang Jianquan, vice general manager of Shanghai Travel Service.

"Since the local pricing authority told us not to transfer the cost to consumers, we have to negotiate with air carriers or pay the increase ourselves if airlines don't agree to help," he said.

Zhang complained that his firm will lose profits on many tourist packages, but he didn't have concrete figures for how much they will lose because of the ticket price increase.

With air travel declining, bus tours to neighboring provinces will surge in the weeklong holiday starting on May 1, said Peng.

Air carriers were reluctant to comment on the price rise and its impact, saying only that it's within the range set by the central government and sales are going on as usual up to now. A new air fare regulation allows carriers to raise fares up to 25 percent.

Besides the tourist groups, the fare rise has also kept individual air travelers at home or resorting to trains.

"Our ticket sales are almost the same as on a normal day, but the days from now should be the peak season," said an air ticket agent surnamed Zhao. "Business air travel is about 8 to 10 percent below what it should be."
23-Apr-2004 -

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