Fuel Surcharges And How They Affect Plane Fare

As the holidays roll in, revenge spending and revenge travel will no doubt make Filipino jet-setters book flights and travel to fun and exotic destinations to spend the holidays in style. ThBut there is more to the face value of your plane ticket. What may surprise travelers is the fuel surcharge included in their plane fare. This is subject to change, depending on global fuel prices around the time you book your ticket. This surcharge will affect how much you pay for your plane ticket.

But don’t let that stop you and your family from experiencing the joys of traveling to another destination, whether locally in the Philippines or internationally. But if you want to understand fuel surcharges a little better and learn where your travel money goes, this article will guide you through it.

What is a fuel surcharge?

Airlines and the Civil Aeronautics Board (CAB) define a fuel surcharge as extra fees that airlines charge passengers in addition to the base plane fare that passengers pay for their seats on any flight. Surcharge meaning additional fees are collected by airlines to help them recover fuel costs and stem losses caused by a spike in fuel cost. As global fuel prices are subject to change, a fuel surcharge can also go up or down. How much extra fee an airline can charge is regulated by a matrix that is approved by the CAB. This matrix is heavily regulated by the government to prevent airline companies from charging an excessive sum and to help passengers avoid additional or excessive burden on their travel expenses.

How does the fuel surcharge work?

In Philippine government, a fuel surcharge follows a CAB-regulated surcharge matrix. The matrix ranges from Level 0 to 20. Lower surcharge means a lower level on the surcharge matrix.

In October, the CAB announced that fuel surcharge is at Level 9. But in November, the board lowered it to Level 8, meaning there is a reduction in surcharges which also lowers the total cost of plane fare.

What Are Fuel Surcharges and How Do They Affect Plane Fare

How does a fuel surcharge affect airfare calculation?

Plane tickets come in a range of prices. The price charged for first class and business class tickets are more expensive than economy tickets. Aside from the usual payment, your airfare payment transactions are also composed of additional charges like excess luggage allowance for additional or excessive load, taxes, and a fuel surcharge.

As the surcharges are not a fixed amount, changes in the surcharge level affect additional charge in the airfare calculation. The CAB determines the appropriate level of fees based on a one-month average of jet fuel prices per liter. This amount will be the ceiling rate for fuel fees. The applicable fees are evaluated in the middle of the month for it to be applied in the following month, and it is announced 15 days before it takes effect.

According to the CAB, airline companies that want to impose or collect surcharges must file their application with the CAB on or before the effectivity period. When when you book airline tickets, the applicable fees on the day that you purchase tickets will be applied to your airfare.

However, there may be times when there are no surcharges. According to CAB guidelines, if the one-month price average of jet fuel is below 21Php per liter, no fuel surcharge will be collected or imposed upon payment of your plane ticket.

Is Air Travel Worth It?

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Is Air Travel Worth It

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