Higher air fares loom next month

MANILA, Philippines — Filipinos have to dig deeper into their pockets if they plan to book a flight in November, as air fares are set to go up with airlines permitted to increase fuel surcharge.

In an advisory, the Civil Aeronautics Board (CAB) announced that it is raising the fuel surcharge that carriers can pass on to travelers to Level 7 for November from Level 6 in October.

Under the CAB’s matrix, Level 7 means airlines may collect a fuel surcharge of P219 to P739 for domestic flights and P722.71 to P5,373.69 for international trips.

As a protocol, CAB said airlines planning to implement the new rates must file their application with the agency before November. On the other hand, carriers are told to apply a conversion rate of 56.77 to $1 for fuel surcharge to be imposed in foreign currency.

Prior to this, CAB observed a fuel surcharge of Level 6 in October, the same rate that it applied in September. Before reaching Level 6, the agency kept the fuel surcharge at Level 4, compelling operators to keep air fares at their most affordable this year.

Airlines may add the fuel surcharge in the billing of their passengers to recoup their losses from price fluctuations in jet fuel.

The country’s largest carriers are preparing for what could be their best performing fourth quarter since the pandemic, expecting to sell at least nine in every 10 seats until December.

Flag carrier Philippine Airlines (PAL) and low-cost operator Cebu Pacific expect to end the year with their passenger numbers hitting the levels they recorded prior to the pandemic in 2019.

PAL president and chief operating officer Stanley Ng said the airline projects a load factor of as much as 90 percent for the fourth quarter. Carries measure their load factor, or the percentage of seats sold against the slots available, to gauge their performance for a specific period.

On the other hand, Cebu Pacific president and chief commercial officer Alexander Lao believes the October and November demand will be lifted by local travel for All Saints’ Day visits. Cebu Pacific expects load factor to equal if not exceed its pre-pandemic high of 87 percent in 2019.

For this year, PAL aims to grow its passenger volume by 55 percent to 14.5 million from 9.3 million last year while Cebu Pacific hopes to surpass its pre-pandemic high of 22.8 million.

The fourth quarter forecasts of PAL and Cebu Pacific are supported by the demand recovery for air travel, with the Ninoy Aquino International Airport welcoming 33.76 million passengers as of September, already beating the 2022 total of 30.94 million.