Myanmar airlines face fare challenges

YANGON, 18 July 2017: Myanmar’s airlines are finding it more difficult to compete and grow traffic due to heightened competition from foreign airlines, according to the Myanmar Travel Association.

The country has 10 airlines with a fleet of around 58 planes serving both domestic and international routes.

One of the major problems facing local airlines is the high cost of fuel and taxes. Fares are subsidised for citizens with foreigners paying more than double.

In the long-run fares have to rise to the same level as charged by foreigners, or the market has to open to low-cost airlines and competitive pricing. Open skies and the introduction of low-cost airlines would generate competition and force local airlines to be more efficient.

The country’s Department of Civil Aviation noted that of the 2 million tourists, who visited the country in 2015, around 7% used local airlines.

Last year, the number of tourists rose to 2.4 million with around 16% of foreigners flying local airlines.

The Union of Myanmar Travel Association said this compared with some 30 million travellers visiting Thailand who can access cheap fares to explore the country.

MTA admits fares are too high for foreigners at double and treble the local tariff for citizens. This is a major barrier when compared with the rest of ASEAN (Association of Southeast Asian Nations). Airlines charge in US dollars and it is very difficult to buy tickets on airline websites.

The other major drawback is the contrast between a busy winter season November through to March and the dramatic decline in traffic during the rainy season months May to October.