Airfare to Rise Again
5 September 2014 08:00 WIB
TEMPO.CO, Jakarta - Transportation Minister Erenst Evert Mangindaan said airfare will be increased before President Susilo Bambang Yudhoyono’s term ends.
The regulation on airfare can be issued if there is no objection from transport services users. "Based on our calculation, airlines need price hike. We have disseminated it," said Mangindaan yesterday.
Based on the ministry’s calculation, current upper limit tariff is below airline break-even-point. Airline income is not balanced with operational costs. Airfare is so low that air transportation is no longer regarded as luxurious.
The plan to increase airfare has been disseminated, but the government demands all airlines to improve their services before increasing tariff.
Previously, Transportation Ministry’s directorate general for air transportation intended to revise Transportation Ministry Regulation No. KM 26/2010 about upper limit tariff mechanism on economy-class passengers in domestic flights.
"The plan to revise includes adjustment towards load factor, formula and tariff calculation as well as tariff based on performance, cost and aircraft population," said the ministry’s legal division chief Israful Hayat.
KHAIRUL ANAM