Tourism "collateral damage" because of airfare prices

Mr. Ngoc Duy (residing in Thu Duc City, Ho Chi Minh City) said that his family of 3 just traveled to Hanoi on their own with a round-trip airfare of over 4 million VND/person, instead of the previous period when it was only approximately 3 million VND or lower if there was a promotion.

Impact of increased airfare and tour prices

Not only individual travelers, many travel companies are also having headaches because of the increased cost of airfare in the total cost of the tour.

A representative of Saigontourist Travel Service Company said that compared to the same period, the price of air tickets booked for individual customers (including tickets booked in large numbers), Free & Easy tour tickets are all higher on average 300,000 - 500,000 VND/trip, of which the highest is the flight route to Phu Quoc, Da Nang... With Tet tours, the increase in air ticket prices has had a significant impact, the supply of accommodation services is not enough to meet the demand, causing the price of the package tour to increase by 1 - 1.2 million VND.

Ms. Nguyen Nguyet Van Khanh, Marketing Director - Vietravel Tourism Company, noted that individual customers who buy tickets close to the departure date; group customers and additional services such as extra luggage... often have price adjustments. Long-distance flights (departing from Ho Chi Minh City to the northern provinces and cities) also have increased prices.

"Increasing ticket prices are a challenge for the tourism industry, especially during the low season when it can reduce the attractiveness of domestic tourism. Tourists may have to reconsider their travel plans or look for alternatives," said Ms. Van Khanh.

Ms. Tran Phuong Linh, Marketing and Information Technology Director of BenThanh Tourist Company, said it is very difficult to find cheap air tickets for domestic routes from Ho Chi Minh City to Hanoi, Da Nang or Phu Quoc for groups of tourists or tourists booking services too close to the date. The optimal ticket price in these cases increases from 20% to 30% compared to the same period. The high airfare leads to a 10% to 20% increase in the price of tours at the end of the year, reducing purchasing power.

Worry about customers switching to foreign tours

According to Mr. Nguyen Minh Man, Marketing and Communications Director of TSTtourist Company, the increase in airfares has increased tour prices by more than 10% - 15%. The closer to Tet, the higher the tour prices. Customers will "weigh and measure" more between domestic and international tours.

According to Ms. Tran Thi Bao Thu, Communications Director of Vietluxtour Travel Company, during peak seasons, airfares for international routes increase but at a rate of about 5%, other costs in the tour itinerary remain unchanged, helping travel businesses "breathe easier" in exploiting tours. If the combo price of airfare, hotels, and restaurants at domestic destinations increases, it will strongly affect tour prices, reducing competitiveness.

In the difficult context, Mr. Tran The Dung, Deputy Director of The He Tre Travel Company, said that the price of tours to the Northeast and Northwest routes remains at 14 million VND/person/7 days, instead of having to increase to 16-17 million VND when airfares increase.

"The company accepts very little profit or break even because with 16-17 million VND, customers will choose to go on foreign tours. Domestic tourism is facing difficulties partly because of the increase in airfares, but if the increase is too high, there is a risk that customers will turn away. Tourism and aviation need to sit down to find a solution," said Mr. Dung.

Some businesses have chosen to switch from air tours to road tours. Mr. Nguyen Tran Hoang Phuong, General Director of Golden Smile Company, said that a month ago, there were about 5-7 groups departing to Hanoi, the northern provinces, Phu Quoc... In recent months, the company has not had any groups traveling on these routes because the airfare is too high. The cost of airfare used to account for about 50% of the tour price, but now it has increased to 60%-65%, businesses have switched to promoting tours by car to places near Ho Chi Minh City or Hanoi and foreign tours.

"Airfare is only one part, the important thing is the quality of tourism products and destinations. If domestic tourism cannot retain customers with quality tour products and routes, and now airfare increases, it will be even more difficult," said Mr. Phuong.

The issue of air tickets affecting tourism development was also raised at the 2023 Conference on dialogue and information reception from Khanh Hoa tourism businesses organized by Khanh Hoa Provincial Department of Tourism on November 29.

Mr. Nguyen Phi Hong Nguyen - Sales Director of Viet Promotion Services and Tourism Co., Ltd., Vice President of Khanh Hoa Province Tourism Association - said that due to high airfares, domestic tour costs have increased, along with the economic recession, the demand for resort tourism has decreased significantly. With the same price, tourists choose to travel internationally instead of domestically. In addition, tourists tend to travel independently by car, not registering through a tour. Stimulating demand during this period is no longer feasible because, like in Nha Trang, service prices are now very low.

K.Nam