Transport firms up charges amid mounting fuel prices
- 104
- Business
- 10:35 07/05/2022
DNHN - About 80-90 percent of fixed-route transport firms have adjusted their fares up by 10-15 percent to offset mounting fuel costs, according to a Ministry of Transport (MoT) report submitted to the Prime Minister, assessing the impact of higher fuel prices.
According to the ministry, fuel prices have increased by 4,625-7,030 VND per litre (0.2-0.3 USD), or 24.91-39.56 percent, after six price adjustment periods since early 2022.
Due to the price hikes, fuel costs have grown to an enormous proportion of the total costs of roadway transport firms, accounting for 40-45 percent of their bills. The firms had no choice but to seek fare rises.
The situation is not better for airlines, whose fuel costs account for 39.5 percent of their total costs. The MoT estimated that airline fuel costs in April climbed by 84 percent compared to September 2015, effectively eroding their profitability.
The Civil Aviation Authority of Vietnam has sent an appeal to the MoT, requesting adjustments upward on ceiling airfares to help airlines to recover.
Meanwhile, railway firms have decided to keep their fares unchanged to attract more passengers and stick to socio-economic targets set by railway authorities. Rail freight rates rose slightly by 3-5 percent.
A few shipping lines have begun to collect fuel surcharges since March to cover higher costs, whereas others have not hiked their fares.
“Mounting fuel prices have not passed on to waterway fares so far. However, the situation may change in the future as fuel prices continue to rise,” the report said.
The MoT has urged agencies and authorities to strictly comply with the instructions of Deputy Prime Minister Le Minh Khai, head of the Steering Committee on Price Management, to keep inflation in check.
Notably, agencies and authorities must not adjust the prices of State-managed goods and services, to ease the cost burden on individuals and firms.
They are also required to keep a close watch on transport firms to ensure that they raise fares reasonably, with any price gouging facing a severe penalty.
The ministry advised the Prime Minister to consider removing or reducing infrastructure fees related to rail, roads and ports, value-added tax on transport services and corporate income tax to mitigate the woes of transport firms.
Regarding struggling airlines, the MoT urged agencies and authorities to implement favourable price policies to help airlines cover higher costs.
The ministry recommends that transport firms be put high on the list of beneficiaries of the economic recovery packages under Resolution 11.
VNA
Related news
#fuel prices
What needs to be done to improve the oil and gas price regulation mechanism?
Economic expert - Dr. Nguyễn Minh Phong shares with the reporter of the Business and Integration Magazine regarding the draft Decree on oil and gas business, which is attracting attention from businesses.
Solutions to curb price increase in Vietnam
The economic and social situation in the first 5 months of 2024 has continued to show positive trends, but the average CPI for this period has increased by 4.03%. Therefore, controlling inflation remains a key goal and challenge for the government.
The exodus of fuel distribution and retail companies: Reasons behind the withdrawal
According to the Ministry of Industry and Trade, as many as 16 fuel companies have requested to return their distribution licenses since the beginning of the year.
Đọc thêm Business
Electricity price hike and the long-term energy dilemma
With EVN's third price hike since 2023, rising electricity costs burden households and industries. Experts warn that sustained losses threaten future power projects, urging reforms to boost investment and ensure energy security.
Vietnam stands poised to seize opportunities in the semiconductor industry
In the context of a rapidly evolving global economy driven by digitalization, the semiconductor industry has emerged as a key strategic pillar.
Pilot project for commercial housing to expand land use rights
The National Assembly Standing Committee has submitted a pilot project on commercial housing through land use rights agreements for National Assembly consideration, aiming to unlock resources.
The National Assembly supports strong decentralization in public investment
The National Assembly has approved a policy of decentralization in public investment management, demonstrating a commitment to economic development and creating opportunities for local governments to mobilize resources.
Assoc. Prof. Dr. Tran Kim Chung: The 1987 Land Law laid the foundation for the real estate market
Assoc. Prof. Dr. Tran Kim Chung, former Deputy Director of the Central Institute for Economic Management, states that the 1987 Land Law laid the groundwork for the development of the real estate market.
Bank interest rates on 31st October: Major players compete fiercely
Bank interest rates have been highly volatile, with one bank making its second rate adjustment in the month as of October 31, 2024, underscoring the competitive landscape.
Amendment of the PPP Law: A new direction to unlock investment resources
To address obstacles in investment through the PPP model, the Ministry of Planning and Investment has submitted a proposal to amend the PPP Law, creating a more favorable legal framework for investors.
Real estate capital faces risks from credit to bonds
Amid global economic turbulence, the real estate market faces significant risks from bank credit and corporate bonds.
Foreign investment: A key driver of Vietnam's economic growth
In the face of global economic fluctuations, attracting foreign direct investment (FDI) has become a bright spot for Vietnam.
Draft resolution on commercial housing: A new opportunity for the real estate market
Amid the challenges facing Vietnam’s real estate market, the addition of a Draft Resolution piloting commercial housing projects brings renewed hope to citizens and promises to boost economic development.