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Volcano fires up flight prices

Pretoria - Stranded airline travellers might have to pay through their noses both for accommodation close to airports and for airline tickets on alternative routes to their destinations.

Airline tickets in the economy class on Emirates airlines which cost R7 000 last week are now selling for R19 000, and business class tickets have shot up from R35 000 to R98 000, says Stephan Ekbergh, chief executive of internet travel agency Travelstart. This applies to tickets from South Africa to the Middle East.

Marooned travellers in Europe are looking for flights to destinations from which they can travel further overland to places cut off from air transport by the ash from the volcanic eruption in Iceland.

Allan Moore, chief executive of the Board of Airline Representatives South Africa says flights to destinations in the Middle East and southern Europe are selling like hot cakes.

These destinations include Spain and Turkey.

According to Moore, airlines are not exploiting people in need.

Their business models simply work in such a way that the first tickets sold for a flight are cheaper. The fuller the aircraft becomes, the more expensive the tickets become.

The same principle applies to hotel-room bookings. Kirk Kensell, head of the Intercontinental Hotel Group for Europe, Middle East and Africa, explained, saying that reservations in the group's Crowne Plaza and Holiday Inn hotels at airports in Britain are up. He says that room prices are determined by availability and demand at a specific hotel.

Brett Dungan, chief executive of the Federated Hospitality Association of South Africa, says that in South Africa the hotels around the international airports have also been fully taken up by stranded passengers. The same pricing model applies in the South African hotel industry.

According to Moore, airlines generally pay for the first night's accommodation. After that the situation is regarded as being beyond human control and passengers have to bear the costs themselves.

Moore says he is not concerned about the immediate continued existence of airlines, but the industry does appear to have suffered a major blow.

Although it seemed that passenger numbers had begun to increase, those who previously travelled business class scaled down to economy. Airlines are thus making less profit from the same number of passengers.

The question is how long the current problem will persist, says Moore. If it continues, airlines will need to seek alternative routes, which would be less economical.

Claude van Kersblick, head of sales at Tourvest Travel Services and a board member of the Association of South African Travel Agents reckons that flights of up to 16?000 people who would have flown from South Africa have been cancelled.

They will receive their money back or could re-book the flights.

The big problem is that London, whose airspace is totally closed, is a hub for flights to Europe.

Van Kersblick expects that people who plan to fly in the next few weeks will revise their plans.

- Sake24.com

For business news in Afrikaans, go to Sake24.com.

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