Air fares to soar in wake of ash crisis

Air fares to soar in wake of ash crisis.

Air Fare Increases
Time to Take Off

Air fares are forecast to rise by more than five per cent this year in the wake of the Icelandic volcanic ash crisis and increasing oil prices.

From a study made in the UK travelers can expect to pay an additional £1.8 billion or £48 each on average, according to figures from the Centre for Economics and Business Research.

The study warns that fares are set to rise by 11.5% by 2012, adding £62 to the cost of an average economy flight from London to New York – from £518 to almost £580.

The rises are predicted as carriers attempt to claw back an estimated £1.3 billion in costs due to the ash cloud disruption by the end of last week.

It is believed that up to two thirds of the costs will be borne by European airlines.

Most airlines were already struggling prior to the crisis, but this, combined with soaring oil prices, will have a knock-on effect on consumers as carriers are forced to pass on rising operational costs to passengers.

Oil prices – the main cost factor for carriers and representing 33% of total operating costs – are up by more than 74% in the first quarter of 2010 compared to 2009.

Additionally, increasing competition and falling demand mean that airline operators have struggled to remain profitable.

Profit margins have been under pressure fro some time as established carriers had to adjust their business models following the market entry of low cost airlines in the 1980s.

In Canada we will not escape these increases either and to add to the misery the new HST Tax due to come into effect on 1st May will increase the tax portion of the airfare.

So if you have been procrastinating about booking that flight, DO IT NOW! before it’s too late to still get that deal.

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Published by rainbowtravel

SIX SECRETS REVEALED ! 1. 26 years experience in the travel and tourism industry, combined knowledge of all of our agents at Rainbow Travel over 40 years from destinations accross the globe.   2. I have tried my hand at every facet of travel from Travel Agent to Tour Operator to Pier Supervisor for Royal Caribbean Cruise Lines & Celebrity, Port Manager for N.C.L.Cruises, Customer Services Agent N.W.A. at YVR and Flight Attendant for Skyservice Airlines.The only thing I haven't done is drive a train, but there is time for that.   3. I have travelled to every major country in Europe and I am from "The World In One City", Liverpool and from there I was the number two operator in the N.W. of England for day trips by air to European cities.   4.Thanks to Skyservice Airlines my Customer Services Manager role on board their aircraft sent me South to destinations in Mexico such as Cancun, Mazatlan, Los Cabos, Puerto Vallarta. Caribbean destinations as well including Montego Bay, Puerto Plata & Punta Cana (Dominican Republic), Liberia (Costa Rica), Varadero & Havana (Cuba) as well as Las Vegas and every major Canadian city so my product knowledge is extensive for the Canadian charter market.     5. I am a champion net-worker being a member of B.N.I. which is a professional marketing organization specializing in word-of-mouth referrals. The BNI model relies on a business networking strategy that generates business referrals within many diverse networks. This enables me to recommend other business professions that are just as dedicated as Rainbow Travel is to customer service.   6. Rainbow Travel is actively participating in the world of Social Media. This means that we regularly Twitter, Blog and post newsletters and amazing deals to our client database.     7. Ask me about cruise ships, I have handled them all at Canada Place for the Alaska Season, Holland America (Zaandam, Ryndam, Westerdam, Oosterdam), R.C.I. (Radiance), Celebrity (Infinity & Summit), NCL (Sun, Wind, Star).  

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