New Delhi: Airfares across Asia Pacific continued their upward trend with a 1 per cent increase in the fourth quarter of 2007.

However, this was slightly lower than the 3 per cent rise witnessed during the third quarter.

The airfare trends were reported by American Express Business Travel in the latest Asia Pacific Business Travel Monitor, the industry's quarterly retrospective pricing benchmark that tracks airfare trends.

The American Express Business Travel Monitor, Asia Pacific tracks a constant set of round trip airfares, all originating in the Asia Pacific region with destinations throughout the world.  More than 370 city pairs are included.  Each city pair is weighted according to usage patterns by business travellers (as per the American Express Business Travel database). 

A high demand city pair such as Melbourne-Sydney will have a higher weighting than Perth-Sydney when determining overall changes to Australian domestic airfares.  The following 14 countries have been included:  Australia, China, Hong Kong, India, Indonesia, Japan, Korea, Malaysia, New Zealand, Philippines, Singapore, Taiwan, Thailand and Vietnam. 

The fourth quarter 2007 report tracks data for the quarter ending 30 December 2007.

The sharpest rise this quarter was in fares to the Americas, which were up 3 per cent. However, even this was slightly softer than the 5 per cent increase seen in the third quarter.

Domestic fares across Asia Pacific were up 2 per cent, intra Asia Pacific fares remained flat, and fares to Europe increased by 1 per cent.

Year over year, Asia Pacific published fares rose 6 per cent, while domestic fares rose 4 per cent, as did intra Asia Pacific and fares to Europe. Fares to the Americas rose 11 per cent.

In India, in a quarter-on-quarter analysis, the published fares were up 6 per cent overall, and up 14 per cent in domestic, 2 per cent in Intra Asia Pacific, flat to Europe, Middle East and Africa, and flat to the Americas.

In the year-on-year analysis, India published fares rose 7 per cent overall, and rose 5 per cent in domestic, 9 per cent in intra Asia Pacific, flat to Europe, Middle East & Africa,  and rose 24 per cent to the Americas.

Although fares were still rising across most routes, there has been some softening since the third quarter of 2007. However, American Express Business Travel does not attribute this to any adjustment based on the economy at this time. Kurt Knackstedt, head of advisory services for American Express Business Travel, JAPA commented, ''The first quarter in 2008 will likely give us a better indication of whether or not the economic conditions in the US will have had an impact on fares across Asia Pacific. In either case, we aren't expecting much movement downwards and business will have to remain vigilant about adhering to existing deals, be aggressive in pursuing new corporate rates and work with their travel management company to gain better insight into these trends. We are not expecting a slow down in business travel in Asia Pacific despite the softening global economy. In contrast to five years ago, the economies in this region continue to show strong growth indications. The conditions for travel suppliers should therefore remain favourable and we expect them to keep pricing aggressively.''

Individual market trends

• Domestic fare increases led the charge in India which recorded a 6 per cent increase in fares overall. Domestic discount economy fares were up 28 per cent and domestic full business fares were up 20 per cent. 
  
• Australia recorded flat fares overall for the final quarter of 2007. However there was some movement in the fare types. Discount economy rose 6 per cent, largely influenced by a spike in domestic fares. Discount business dropped 6 per cent, affected by a 16 per cent decrease in Intra Pacific discount business fares and a 10 per cent decrease in discount business fares to the Americas.
  
• China fares were also flat overall with the only notable change occurring in discount business fares to the Americas which decreased by 9 per cent.
  
• In Hong Kong, the greatest increases were in full first class fares (4 per cent) and full business class fares (3 per cent). On flights to the Americas these increases were as high as 13 per cent for full first class and 11 per cent for full business class.
  
• Indonesia published fares were up 1 per cent overall with the greatest increases seen in full business fares to the Americas which rose 15 per cent.
  
• Japan fares remained flat with no notable movements in any of the fare types.
  
• Korea published fares were up 2 per cent overall with the greatest increases seen in fares to Europe, Middle East and Africa – up 2 per cent in full first, 4 per cent in full business and 3 per cent in full economy.
  
• Malaysia fares remained flat with no notable movements in any of the fare types.
  
• Discount economy fares in New Zealand increased by 8 per cent on Intra Pacific routes, 9 per cent on Europe, Middle East and Africa routes and 7 per cent to the Americas.
  
• The Philippines was the only country to record fares decreasing overall by 1 per cent. The greatest drop being in discount business fares on Intra Asia Pacific routes.
  
• Full economy fares to the Americas from Singapore dropped by 15 per cent. Major price reductions such as this can often be attributed to special deals provided by certain carriers. Singapore remains a very competitive long haul market and although dominated by Singapore Airlines there are many other options by connecting points via Hong Kong and Tokyo. The drop in economy pricing would have more impact for leisure travellers.
  
• Taiwan published fares were up 2 per cent overall. Full first class fares to the Americas saw the greatest increase at 12 per cent.
  
• Thailand recorded decreases in fares to Europe, Middle East and Africa, down 7 per cent for discount business and 4 per cent for discount economy. Overall fares were up 1 per cent.
  
• Vietnam fares remained flat with no notable movements in any of the fare types.