AirAsia Zest eyes another fare hike for 8 int’l routes

MANILA, Philippines - AirAsia Zest, jointly owned by Zest Airways Inc. of businessman Alfredo Yao and Philippines AirAsia, is set seeking another round of fare increase for eight international destinations.

In a petition before the Civil Aeronautics Board (CAB), the low cost carrier is seeking an authority to impose upward adjustment of between P70 and P150 on fuel surcharge imposed on eight international destinations.

The fuel surcharge for Manila – Kota Kinabalu would now cost to P750 from P650; Manila – Kuala Lumpur to P970 from P900; Manila – Shanghai to P1,670 from P1,600; Manila – Macau to P750 from P600; Manila – Incheon to P2,670 from P2,600; Cebu – Incheon to P2,670 from P2,600; Kalibo – Incheon to P2,670 from P2,600; and Kalibo – Pusan to P2,670 from P2,600.

The CAB allows airlines to impose fuel surcharge on international and domestic passengers as a temporary relief to help them recover losses arising from the increase in jet fuel prices in the world market.

Latest results of the Jet Fuel Price Monitor of the International Air Transportation Association (IATA) showed that the price of jet fuel average increased 5.7 percent to $124.3 per barrel from a year-ago exceeding the full year target of $123.2 per barrel set by IATA.

Last April, the CAB gave AirAsia Zest the green light to raise fares for 13 domestic and international destinations due to higher price of aviation fuel in the world market.

The airline raised by P100 bringing to P400 from P300 the fuel surcharge imposed on passengers of Manila – Cebu, Manila – Kalibo, Manila Puerto Princesa, Manila – Tacloban, and Manila – Tagbilaran.

Likewise, the fuel surcharge imposed on passengers of Manila – Kota Kinabalu, Manila – Kuala Lumpur, Manila – Shanghai, Manila – Macau, Manila – Incheon, Cebu – Incheon, Kalibo – Incheon, and Kalibo – Pusan.

The Committee on Franchise of the House of Representatives has already approved the plan of AirAsia Inc., the Philippine unit of low cost carrier giant AirAsia Berhad of Malaysia, to further increase its stake in Yao’s ZestAir.

AirAsia Philippines and ZestAir entered into a strategic alliance agreement in March last year. AirAsia Philippines completed the acquisition of an 85 percent economic interest and 49 percent voting rights in ZestAir as well as a 100 percent interest in Yao’s Asiawide Airways Inc.

 In exchange, Yao’s ZestAir got $16 million as well as 13 percent interest in AirAsia Philippines. The proposed complete takeover of ZestAir was recently approved by the House of Representatives.