CAB likely to OK airlines’ fuel surcharge applications

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THE Civil Aeronautics Board (CAB) is expected to issue on Monday its decision on several local airlines’ application to impose a fuel surcharge.

“We will make the announcement on Sept. 10. But right now, we are not making the announcement yet kasi meron pang [because there’s still] procedure being undertaken, legal procedures…. We’re just completing the process,” CAB Executive Director Carmelo L. Arcilla told reporters on the sidelines of an aviation forum on Friday.

Philippine Airlines (PAL), Cebu Pacific and Philippines AirAsia have asked the CAB to allow them to pass the additional costs from rising jet fuel prices to their passengers.

At the same time, the Department of Transportation (DoTr) said it has already approved the “fuel surcharge matrix,” which will serve as the guide for future surcharge applications whenever jet fuel prices spike.

“The one that we approved as far as DoTr is concerned is the matrix that was prepared by CAB, which is between a higher matrix proposal and a lower one. Nandun sa gitna [Somewhere in between]. Pero everything naman will depend upon the cost of fuel, yung mga ganyan [But everything will depend upon the cost of fuel, those things],” Transportation Undersecretary for Aviation Manuel Antonio L. Tamayo told reporters during the same event.

The surcharge matrix, which was crafted by the CAB and airline companies, will still need CAB’s final approval.




“We followed the model for Japan, because we want to have a matrix where every time there is an increase in fuel or an increase in anything, or mag-decrease [or there’s a decrease], talagang pupunta pa sa’min [do you need to go to us]? You have a matrix naman, just follow it [Now you have a matrix, just follow it],” Mr. Tamayo said.

The International Air Transport Association (IATA) said the global price of jet fuel has surged 24.5% to $92.4 per barrel as of Aug. 31 compared to a year ago.

PAL asked for a fuel surcharge of between P158 to P405 for domestic flights, while Cebu Pacific and CebGo are seeking a fuel surcharge of between P70 to P280. AirAsia applied for a fuel surcharge of P120 to P240 for domestic flights and P300 to P750 for international flights.

PAL and Cebu Pacific both said rising jet fuel prices hurt their earnings in the first half.

Philippines AirAsia also cited the rising price of fuel as one of the factors that affected its plan to list in the stock exchange.

“We’re still working on (the initial public offering), but I think it might get delayed. Probably next year. There are too many problems at the moment, especially the fuel prices, the foreign exchange rate, plus the Boracay closure,” Philippines AirAsia Chief Executive Officer (CEO) Dexter M. Comendador told reporters in Makati City on Friday. — Denise A. Valdez