Fuel surcharge more than triples as Loganair grapples with rising costs
RISING fuel prices are now being felt by Loganair customers when they purchase tickets, an airline official has said.
Ronnie Matheson, Loganair’s chief commercial officer, said the company has seen an almost 83 per cent rise in the cost of jet fuel in the last year, driven by the closure of the Strait of Hormuz.
He assured the public that Loganair had no plans to make cancellations or changes to its network, as has been reported nationally by other airlines, and said there were positive signs about the availability of fuel.
But he told a meeting of Shetland’s external transport forum on Tuesday afternoon that they had “started to pass some of the cost” of jet fuel on to their passengers through the fuel surcharge being charged.
The fuel surcharge fluctuates depending on where passengers are flying to from Sumburgh Airport, with Matheson saying there were three tiered levels.
Shetland News reported last October that the surcharge was £5.50 on a one-way flight to Glasgow.
However, that surcharge now appears to have risen to £17 on a one-way flight to Glasgow next week.
Matheson said they had increased the fuel surcharge rather than air fares because they wanted to be “transparent” about where cost increases were coming from.
He said they had spent the last few months grappling with the rising costs and lack of availability of jet fuel.
“Fuel prices are changing constantly,” he told Tuesday afternoon’s external transport forum.
“Between meetings, we’ve probably spent most of time thinking what are we doing from a fuel planning, fuel pricing point of view.”
Around a quarter of Loganair’s costs were driven by fuel at present, he told the forum.
Customers previously paid £2.75 each for a one-way trip to Aberdeen, and £5.50 each when flying one-way to Glasgow, in fuel surcharge.
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The fuel surcharge to Aberdeen per customer has now risen to £13.50 each way, and £17 to both Glasgow and Edinburgh.
While Matheson assured members that there were no current plans for cancellations or changes to the network, he said if fuel prices continued to be volatile then they “may need to review it once again”.
He added that they had seen a “small impact” on demand as a result of the uncertainties around flights and fuel costs.
Forum chairwoman Moraig Lyall asked if the price of Loganair flights was ever likely to drop down to the levels of around two or three years ago.
The airline’s corporate affairs head said there were “amazingly high costs for running an airline”, particularly in regional airports where demand was not as high as in major cities.
“There’s certainly ways we can make some slight improvements,” Matheson said.
“There’s a balance to be had though.”
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