Those who bought AA after hearing the rumor of privatization must be regretting now


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Vietnamese airlines battle over air fare floor price proposal

The Transport Ministry says it will study the proposal carefully before making a final decision.
National flag carrier Vietnam Airlines has proposed to the aviation authority to set a floor price for air tickets, similar to a plan sought by its subsidiary Jetstar Pacific, but budget airline VietJet has opposed the move, saying it would create "unfair competition".

Vietnam Airlines, which reported a huge loss in late 2016, suggested the floor price for domestic air fares should be set at between VND1.54 million and VND4.2 million ($68-$185) in a proposal sent to the transport ministry in late March.

The Civil Aviation Authority of Vietnam (CAAV) is seeking opinions from airlines whether to raise the air fare cap for economy class by 7-16 percent from the current range of VND1.6 million to VND3.75 million.

Jetstar Pacific, one of Vietnam's two budget airlines, has suggested the floor be set at 29-34 percent of the cap. The carrier is 70 percent owned by Vietnam Airlines, while Australia's Qantas Airways owns the remaining 30 percent.

But VietJet Air, Vietnam's only private airliner, said setting a price floor is not a common rule worldwide and is also against Vietnam’s Competition Law.

“The rule will hinder the opportunities for low-cost carriers. That means it will create unfair competition,” a VietJet representative said.

Lai Xuan Thanh, head of the CAAV, said the aviation authority has yet to make a proposal to the transport ministry, and the idea of a floor price comes from the carriers.

http://e.vnexpress.net/news/business/vietn...al-3565328.html


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