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The Honolulu Advertiser
Posted on: Thursday, August 20, 2009

Fuel add-ons could crimp Japan travel


By Robbie Dingeman
Advertiser Staff Writer

Hawaii news photo - The Honolulu Advertiser

Tourism officials in Hawai'i are concerned that fuel surcharge plans at Japan Airlines and All Nippon Airways could discourage travel to the Islands at a critical time.

ADVERTISER LIBRARY PHOTO | 2008

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Japan's two largest airlines plan to reinstate a fuel surcharge on international airfares on passenger tickets issued from Oct. 1 that would tack on $39 each way to flights to and from Hawai'i and possibly discourage travel to the Islands.

High fuel surcharges have been cited as a factor in a declining number of Japanese tourists flying to the Islands. So tourism officials are keeping a close watch on any surcharge increase and how it may affect a key segment of Hawai'i's visitor market.

Jerry Gibson, area vice president and managing director for Hilton Hawaii, said Japan travel was just rising back to expected levels and he worries this added cost could slow or stop that recovery.

That came after the numbers began nosediving in May when H1N1 flu first spread to Hawai'i and Japan. For the first six months of 2009, Japanese visitor counts are off by 11 percent compared with the same period in 2008.

"The fuel surcharge increase comes at a very bad time as we head into a soft fourth quarter," Gibson said.

"We understand the economics behind this difficult decision and hope that it doesn't impact business coming to the Islands from the East."

"It's a business decision; they're trying to recoup additional costs," said state Tourism Liaison Marsha Wienert.

But while she understands the financial reasons for the added cost, Wienert said she also hopes the airlines will still help to encourage people to travel.

The global economy and swine flu fears had hit the Japanese travel market hard and prompted many to stay home.

The JAL Group has requested approval from the Japanese Ministry of Land, Infrastructure, Transport and Tourism citing recent increases in fuel prices.

The surcharges varied from as little as $3 to South Korea to $98 to Brazil.

The fuel surcharge for international tickets issued between July 1, 2009, and Sept. 30, 2009, was removed when the average price of Singapore kerosene (jet fuel) from February to April 2009 fell below the $60 U.S. per barrel benchmark.

Based on the average increasing to $71.41 per barrel of Singapore kerosene in the three-month period of May to July 2009, JAL decided to resume charging a fuel surcharge for international tickets issued within the three months starting Oct. 1 to Dec. 31, 2009.

The JAL increase follows a similar move by Japan's second-largest air carrier, All Nippon Airways. But ANA announced it would set the new charge for only two months to allow flexibility in adjusting it again.

The fuel surcharge to be placed on tickets issued from January to March 2010 will be reviewed based on the average price of fuel for August through October 2009.

A JAL spokeswoman said the company is continuously conducting a wide range of measures to limit the full impact of the price increase, including the introduction of more fuel-efficient small and medium-sized aircraft to its fleet. 

JAL originally introduced the fuel surcharge on international tickets in February 2005 in response to a rise in the cost of jet fuel.

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