Bangkok Airways is raising ticket prices and adding fuel surcharges from April 1 as oil prices climb to between US$170 and US$180 per barrel. The airline is hedging 30% of its fuel costs and is keeping a close watch on the situation, warning that its annual plan could need revising if prices stay elevated.
CEO Puttipong Prasarttong-Osoth said domestic fares will rise by 15 to 20% starting April 1, though prices will stay within the government-approved ceiling. For international routes such as flights to the Maldives, a fuel surcharge of between US $50 and US $60 has already been applied.
The airline has hedged roughly 30% of its fuel at between US $80 and US $90 per barrel to manage costs for the rest of the year. Puttipong said conditions were looking positive at the start of the year, but turbulence in late February prompted a review of growth targets.
“If the situation persists for two to three months, annual goals might need adjustment since fuel accounts for 16% of operational costs,” he said.
If global oil prices remain high, the airline may need to restructure its cost management or request a fare ceiling adjustment from Thailand’s Civil Aviation Authority.
Puttipong, who also serves as president of the Airlines Association of Thailand, has proposed that the government reduce the fuel excise tax from roughly five baht per litre to ease the burden on consumers.
Despite the pressures, advance bookings for the Songkran period in April remain stable and have not been affected by tensions in the Middle East. As of March 16, bookings for travel between April and September this year were up 1% compared to the same period last year. Second-quarter bookings dipped 3%, while third-quarter bookings grew 9%. The European tourist market continued to grow last year, rising an average of 11%.
Source: The Thaiger