Starting from March 1st, the decree issued by the Ministry of Transport specifies that the ceiling prices will be adjusted to increase by about 5% compared to before. Notably, this is the first adjustment in nearly 10 years.
At the International Airline Symposium (IAS) 2024 held today (February 28th) in Hanoi, some experts pointed out that Vietnam is one of the few countries in the world currently controlling ceiling prices and floor prices for air tickets. In the future, Vietnam’s aviation industry will move towards an open market when there is appropriate competition and regulation.
Raising the ceiling on airline ticket prices can help passengers with low spending capacity access airline services. Photo: NIA.
According to airline representatives, there have been significant changes in the input costs of the aviation industry over the past period. Therefore, the new regulations on ticket prices provide opportunities for operators to offset the sharp increase in operating costs due to factors such as fuel prices and currency exchange rates, as the aviation industry predominantly uses the USD. However, increasing the ceiling price of air tickets also benefits passengers.
Mr. Le Hong Ha, CEO of Vietnam Airlines, stated that airlines will not continue adjusting their price ranges on domestic routes. Increasing the ceiling price allows companies to continue investing in the quality of services for premium customers.
“This allows airlines to prevent lowering their prices to serve the needs of budget-conscious passengers. Additionally, during market downturns, airlines will offer more promotional programs,” Mr. Le Hong Ha said.
According to Decree No. 34/2023/TT-BGTVT, effective from March 1st, the Ministry of Transport amended the framework for basic economy passenger transportation service prices. Notably, routes with distances under 500 km will have a ceiling price of 1.6 million VND/ticket/one-way for economically and socially developed routes and 1.7 million VND/ticket/one-way for other routes.
The remaining route groups will see price increases ranging from 50,000 to 250,000 VND/ticket/one-way compared to the previous regulations, depending on the length of each route.
Specifically, for routes from 500 km to under 850 km, the ceiling price is 2,250,000 VND/ticket/one-way, routes from 850 km to under 1,000 km have a maximum fare of 2,890,000 VND/ticket/one-way, routes from 1,000 km to under 1,280 km have a ceiling price of 3,400,000 VND/ticket/one-way, and routes with distances of 1,280 km or more have a ceiling price of 4,000,000 VND/ticket/one-way.
Therefore, routes like Hanoi – Ho Chi Minh City and Hanoi – Phu Quoc with distances of 1,280 km or more see the most significant increase in ceiling prices at 6.25% and 6.67%, respectively. Meanwhile, route groups under 500 km, such as Ho Chi Minh City – Da Lat and Hanoi – Vinh, maintain their ticket prices.
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