After a 20% price hike announcement for domestic airfares, prices for local tours have accordingly been considerably increased, leading to a ridiculous state where domestic tours are more expensive than foreign ones.

The hike which takes effect this week will negatively hurt the domestic tourism industry that is already suffering from bad reputation with poor service, pollution, peddling, and robberies.

A couple from Tan Binh District, Ho Chi Minh City told Tuoi Tre that they decided to visit Thailand for a vacation this Tet (lunar New Year) instead of their original plan to tour northern Vietnam.

The reason is a six-day and five-night trip in Thailand (Bangkok - Pattaya) costs around VND9 million (US$428) per person while a tour to northern Vietnam (Hanoi, Ha Long Bay, Sa Pa, Do Temple) costs at least VND12 million per person - 33% higher.

Their four-member family will save over $500 by opting for the foreign trip.

According to tour manager Tran Long, the unreasonably high fees will result in the loss of domestic customers and with it, a series of tourism-supporting industries will be affected like aviation and hospitality.

He called on the government to protect domestic tourism.

Under the current price quotations, tourists from Ho Chi Minh City will find it more expensive to have a holiday in the north of Vietnam than in neighboring countries like Thailand, Singapore and Malaysia, assuming similar service quality.

For tours to Cambodia (Siem Reap - Sihanoukville - Phnom Penh), it is roughly as costly as tours to central Vietnam (Hue, Da Nang, Hoi An).

30% price hikes for domestic tours?

Tran The Dung, deputy director of The He Tre tourism company said that after the price hike announcement by Vietnam Airlines, his partners including hotels, restaurants also announced price increases.

“Prices rise while quality is not ensured. This can lead to a price increase of 30% for domestic tours in 2012”, Dung complained.

Similarly, Nguyen Ngoc An, head of domestic tours at Fiditour company said that Vietnamese locals from southern localities will surely back away from tours to northern regions and vice versa and opt for foreign tours for cheaper price and better service.

Prices for domestic tours will definitely rise fast as air fares account for 60% of costs of a domestic tour while they account for just 40% at foreign tours, An added.

Meanwhile, Vietravel, Saigontourist, Fiditour and some popular Vietnam travel agencies have stopped accepting orders for tours by airplane to Con Dao and Phu Quoc islands, two famous tourism hotspots in southern Vietnam.

The Ministry of Finance has allowed Vietnam Airlines to hike the ceiling prices of domestic flights by up to 20 percent as of December 15.

Accordingly, single tickets for air service connecting Ho Chi Minh City and Hanoi will have a new ceiling price of VND2.69 million (US$129), excluding taxes and surcharges. The current cap is VND2.22 million.

Single tickets for HCMC – Da Nang flights will see a ceiling price increase to VND1.77 million, from the current VND1.48.

Meanwhile, the Hanoi – Phu Quoc air service, whose single ticket currently fetches VND2.72 million, will cost up to VND3.27 million as of mid-December.

The HCMC – Hanoi route, which is 1,280 kilometers long, will have the maximum price of VND3.84 million ($184) for single ticket, excluding the 10-percent tax and surcharge.
The Hanoi – Phu Quoc and Hanoi – Con Dao services, the longest domestic air routes, will have a new maximum price of up to VND4.6 million.