Plane tickets on domestic flights to all 30 destinations in Argentina went up by an average of 15 percent from midnight last night, according to Resolution 118 of yesterday’s Official Gazette.Transport Secretary Juan Pablo Schiavi authorised the hike so as to give back a margin of reasonable competition between airlines and long-distance coach companies. The latter has seen a downturn in passenger numbers since 2008 when President Cristina Fernández de Kirchner’s government started subsidising Aerolíneas Argentinas.
According to the new tariff bands published in the Official Gazette yesterday, the measure aims to“balance out the competition with long-distance road transport.”
Flight tickets from Buenos Aires rose from between 11.1 percent and 16.5 percent to destinations including Bahía Blanca, Bariloche, Córdoba, Mendoza, Salta and Ushuaia. The previous hike was last implemented in November 2009.
Prices will now be set between the reference tariff (TR) and the maximum tariff (TM) and will also apply to domestic flights originating from Córdoba.
The State subsidies on domestic flight prices as well as an increase in the overall frequency of domestic flights have been affecting long-distance coach companies for two years despite the indirect gasoil subisidies they receive.
Transport firms from the private sector welcomed the news because plane tickets to various destinations have often been priced cheaper than coach tickets. Bus companies have been complaining about the “price distortion” which they consider has kept them out of the long-distance travel market for some time.
“Flights have been subisidised for two or three years now, which means airlines have been able to offer substantial discounts,” said Mariano Telez from long-distance coach company Vía Bariloche. “With an increase in offers and daily flights, our sector has been affected as they have taken away a lot of our passengers.”
He added: “Although our prices went up by 10 percent on June 1, and will go up by five percent on July 1, the 15 percent hike on plane tickets was necessary and will help us.”
For example, in February this year, a plane ticket from Buenos Aires to Bariloche would have set passengers back 800 pesos while a long-distance coach ticket cost 600 pesos.
In addition to subsidised plane tickets and an increase in the number of flights, the long-distance coach sector also suffered at the hands of 2009’s swine flu epidemic.
“We didn’t have much demand last winter because of swine flu. Although the new season is about to start, we didn’t have many bookings last weekend and we don’t have many booked for this coming weekend, but we hope that will change with the airline price hike,” added Telez.
Meanwhile, yesterday, Planning Minister Julio de Vido ratified President Cristina Fernández de Kirchner’s decision to recover Aerolíneas Argentinas and said it would be able to finance itself by 2012.
De Vido, who launched the airline’s new business plan, “Soaring High”, to more than 1,500 employees at Aeroparque Jorge Newbery, said a large part of that would be “upheld through the administration of provisional state funds.”
The minister added that it would have been “impossible to renovate planes and improve services.” He said that the funds had been “directed towards international markets” until 2009.
Mariano Recalde, president of Aerolíneas Argentinas, also attended the launch which unveiled the company’s new corporate identity, said the main objective of its 2010-2014 business plan was to put the firm in conditions “ to contribute to the country’s economic and social development, and to connect Argentines with each other.
“We want to return Aerolíneas to its former glory, to its role as a public service that caters to the country’s interests as a tool for the development of Argentines,” he added.
Re-print of the article " Domestic plane tickets hiked 15%” written by Sorrel Moseley-Williams for the Buenos Aires Herald
Graphic by the Buenos Aires Herald
The original article is available at:
http://www.buenosairesherald.com/BreakingNews/View/35951
