Fuel surcharges adjusted

On September 23, Hong Kong’s Civil Aviation Department (CAD) gave approval for passenger fuel surcharges levied by three airlines to be increased or remain at the same level for the month of October. Starting now, the surcharges will be reviewed on a monthly basis, instead of bi-monthly, to reflect more quickly the changes in aviation fuel prices.

The new maximum levels of fuel surcharges will be US$9.10 for short-haul flights and US$42.05 for long-haul flights, which represent an approximate 3% increase. The applicable surcharge levels are based on the ticket-issue date. 

“When compared with the average amounts of surcharges at the international level, the surcharges on the local routes remain at a lower level,” said the CAD spokesman. “Fuel surcharges are a type of aviation tariff which requires the approval of the relevant aeronautical authorities before they can be levied.”

When reviewing applications for levying fuel surcharges, CAD considers the price of aviation fuel, the justifications provided by the airline operators and other relevant factors, such as the charges levied by other airlines. The agency uses this approach, regardless of whether oil prices are on the increase or decrease.

Passenger fuel surcharges allow airlines to partially recover the increase in operational costs due to fluctuations in aviation fuel prices. The CAD regularly reviews the surcharges; the last review in July resulted in maximum surcharge levels of US$8.84 for short-haul flights and US$40.76 for long-haul flights.

Visitor arrivals drop

Hong Kong received 2,378,298 visitors in July, according to the Hong Kong Tourism Board (HKTB), a 12.2% decrease year-on-year. The fall is largely attributed to the 13.7% drop in arrivals from mainland China, compared with exceptional growth in July 2008, when many Mainland visitors advanced their trips to Hong Kong before the 2008 Summer Olympic Games.

In other short-haul regions, the decline since the outbreak of H1N1 flu in May has narrowed as consumer concerns about the disease have receded. Attractive summertime offers and packages further boosted travel sentiments.

The table below summarizes the arrivals from different market regions:

* Figures include arrivals from the Macao Special Administrative Region

Most arrivals in the long-haul regions saw growth in July, given the lower base of arrivals in 2008 due to the visa policy adjustment by the Mainland in the run-up to the Olympics. This is exemplified by the increase in arrivals from The Americas, as well as Europe, Africa and the Middle East by 1.2% and 2.2%, respectively, in July. 

For the seven-month period from January to July, total visitor arrivals stood at 16,075,077, or 4.9% lower than the same period last year. With the exception of mainland China, which achieved 1.5% growth in its arrivals year-to-date, all other long- and short-haul markets registered declines.

Overall, 56.7% of all visitors to Hong Kong in July stayed in the city at least one night, 2.9% lower year-on-year. The remaining 43.3% of visitors either returned home or left for another destination the same day they arrived.

Hotel occupancy across all categories of hotels in July was 71%, 18% lower than July 2008. The average achieved hotel room rate across all hotel categories was US$113.07, or 19.4% less year-on-year.