AIR PASSENGERS will likely pay higher fares in 2025 because the Civil Aeronautics Board (CAB) is expected to complete its deliberation on the proposed collection of terminal enhancement fee this 12 months.
“Actually, that is being deliberated right away by the CAB. They at the moment are studying whether or not we are going to allow [airlines] to [collect these additional fees],” Transportation Secretary Jaime J. Bautista told reporters on Thursday.
In October, local carriers sought CAB approval for the gathering of the terminal enhancement fee to cover the rising cost of using Ninoy Aquino International Airport (NAIA). The private operator, Recent NAIA Infra Corp. (NNIC)., has hiked landing and takeoff fees, and other fees starting October.
The proposal of local carriers to gather terminal enhancement fees might be deliberated by the CAB Board inside the 12 months and provide you with a choice as early as January 2025, Mr. Bautista said.
He said the opportunity of “tucking in” the proposed terminal enhancement fees in passenger’s base fare can also be being regarded as an option.
To recall, local carriers have requested an extra P150 terminal enhancement fee for domestic roundtrip flights and about P300 per way for international flights.
The extra fees were earlier proposed to be collected as a separate fee on top of the bottom fare. It is going to be itemized on the passenger’s booking receipt individually from the bottom fare, like passenger fuel surcharge and value-added tax.
Mr. Bautista said the Department of Transportation (DoTr) is not going to object if airlines decided to tuck within the proposed terminal enhancement fees in passengers’ base fare because airlines have the choice to extend their airfares without the approval of CAB.
“We’re okay with it because they’ll just try this. We don’t even must approve that, they’ve the power to do this… The pricing of airlines is predicated on revenue management. You see, it increases during peak season. They will just tap this [approach] in increasing and decreasing fares,” Mr. Bautista said.
Nigel Paul C. Villarete, a senior adviser on public-private partnership on the technical advisory group Libra Konsult, Inc., said it might be best if airlines decided to incorporate all additional fees in the bottom fare as it might lessen the confusion from passengers.
“Airlines won’t prefer it though, because it might make airfares higher resulting from the add-on costs and they might should bear the problem of remitting all other costs attached to the ticket,” he said.
Further, Mr. Villarete said it might be difficult to tuck in any additional fees in base fare since it passes the responsibility to the airlines which may cause disagreements if not properly communicated.
Apart from the three local carriers: Philippine Airlines operated by PAL Holdings, Inc.; Cebu Pacific operated by Cebu Air, Inc.; and Philippines AirAsia, Inc. (AirAsia Philippines), Manila International Airport Authority (MIAA) said previously that other foreign carriers operating at NAIA can also seek the identical relief. — Ashley Erika O. Jose
