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Ticket prices a blow to CNMI’s ailing tourist industry

By Gemma Q. Casas

SAIPAN, CNMI (Marianas Variety, July 8, 2008) – The tourism-based economy of many Pacific islands, particularly the Northern Marianas, is suffering from the soaring oil prices as Japan-based airlines charge each passenger an additional $150 per trip to their destinations on top of the regular airfare.

Michael D. Merner, managing director of the Tokyo-based Aviareps Marketing Garden, a public relations firm hired by the Marianas Visitors Authority to promote the CNMI in Japan, said the $150 per passenger fuel surcharge only applies to the CNMI, adding that the farther the destination, the higher the fuel surcharge gets.

"As you know fuel costs are record levels right now. There’s no end on sight. It’s just rising every week and the airlines can’t absorb those costs themselves, they pass them on to passengers and that’s what the fuel surcharge is," he said in an interview. "As fuel prices go up, the fuel surcharge goes up."

About three years ago, just before the Japan Airlines abandoned the Saipan route mainly due to economic reasons, international airlines were charging just $22 for fuel surcharge per passenger. Now Merner said it has gone up to over $150.

"So if you buy a package to the CNMI, you pay on top of your package price a $150 per person. Let’s say you’re a family of four — a couple and two kids — then you have to pay an extra $600 per trip just to come to Saipan. When the cost of one package might have been just $300 to $400, that’s a huge additional cost you have to pay," said Merner.

Although airlines also charge domestic fuel surcharge in Japan, it’s a lot cheaper than going to destinations overseas.

For instance, Merner said travel time between Saipan and Okinawa from Tokyo — two and a half hours — is about the same yet travelers pay just $10 for fuel surcharge to enjoy Okinawa’s beaches and natural sceneries just like what Saipan has.

"Okinawa is our number one competitor. They are paying just $10 for fuel surcharge and we’re paying $157. That makes going to Saipan, much, much more expensive for Japanese," said Merner.

MVA Chairman Jerry Tan said the fuel surcharge is making traveling more expensive than ever before.

"Traveling is no longer affordable because now you also have to pay $150 just for the fuel surcharge per person," he said. "That’s a very big but not unique problem for the CNMI."

But Northwest Airlines, the only international carrier serving the Saipan route from Japan, believes the CNMI is still saleable to Japan’s traveling public.

This month, it added daily flights to the route from the Narita International Airport.

Tan said the additional flights were well received and he hopes the trend continues.

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