Bus fare to boost low-cost airline

Bus fare hike that comes into effect next week is likely to benefit the low-cost airline segment as domestic passengers are now having wider choice. 

The fare tariffs for buses in the northern part of the country including Bukoba, Mwanza, Shinyanga and Arusha are more than the amount charged by the low cost carrier at 32,000/- (tax exclusive).

This, according to the industry experts, the fare hike of average of 25 per cent will increase buses passengers’ migration due to the fact that the airline travel is faster, safer and more comfortable. 

The Tanzania Civil Aviation Authority-Consumer Consultative Council (TCAACCC) Executive Secretary, Mr Hamza Johari, told the ‘Daily News’ that the low cost carrier took a number of bus passengers well before the fares were hiked.

“This (bus fare hike) will increase the migration even further - but that is where we want to be in a free market economy: Consumers must have the right of choice,” Mr Johari said. 

He said FastJet has some disadvantages as travellers are not flexible to change their itinerary at will, but the increase of upcountry bus fares will definitely push more customers to the airline.

Though, he, said even if the low cost air fares are slightly above the buses, other costs and time incurred on the road will be absolved and compensated by going by air. 

The University of Dar es Salaam Senior Lecturer (Economics), Dr Haji Semboja, said diversifying mode of transport was healthy for the national as at the end of the day it gives a wider travelling choice.

“The problem is that passengers demand for (low cost) airline might go to the roof to see the service provider increase prices - under normal supply and demand law,” Dr Semboja told the ‘Daily News’ yesterday. 

But he faulted the regulator Surface and Marine Transport Regulatory Authority (SUMATR A) move to increase prices that would impact negatively on household purchasing power.

“This will sure increase inflation at the end of the day as passengers, goods and services prices will go up - while hardship at household level will increase to cut down the number of safari per person.

“It might end to be a loss instead to a gain to bus owners,” the economist warned. An entrepreneur, Mrs Lillian Kitembe, said passengers would surely shift to FastJet as they know how to beat luggage charges by shipping their excess cargo via buses and receive them after arrival at their destinations.

“A number of my colleagues are doing so when travelling from Mwanza and Arusha. Put luggage on bus and travel light on FastJet,” Mrs Kitembe said. 

On Tuesday, Sumatra announced the rise of buses, train and commuter buses fares by an average of 25 per cent. The new fares show that from Bukoba to Dar are 55,100/- and 85,000/- for ordinary and luxury buses respectively that are relatively high compared to 50,000/-(tax inclusive) of FastJet. The airline average fare is 85,000/-.
Source: The Daily News, www.dailynews.co.tz, reported by Abduel Elinaza in Dar es Salaam
Share on Google Plus

About Abduel Elinaza

This is a short description in the author block about the author. You edit it by entering text in the "Biographical Info" field in the user admin panel.