JAL applies for revision of international cargo fuel surcharge

Today JAL filed an application with the Japanese Ministry of Land, Infrastructure, Transport and Tourism (MLITT) to revise from October 1, 2008 the international cargo fuel surcharge for flights departing from Japan only.

The international cargo fuel surcharge on long-haul international routes for flights departing Japan will increase from 136 yen to 157 yen per kg. In the case of medium-haul international routes, the surcharge will increase from 117 to 135 yen per kg, and on short-haul routes from 98 yen to 113 yen per kg (see below).

JAL has decided to increase the fuel surcharge on international cargo flights departing Japan, as during the 3-month period May - July 2008 the price of Singapore kerosene-type jet fuel averaged US$163.54 per barrel.

However, after examining market trends and demand as well as the progress of its own restructuring efforts, JAL has decided not to raise fuel surcharges up to its US$160 and over benchmark level, but has opted instead to just increase its fuel surcharges to its USD$140 to under USD$145 level.

The company is conducting a wide range of countermeasures to limit the full impact of the price increase including fuel hedging, fuel consumption reductions, and the introduction of more fuel-efficient medium-sized aircraft to its freighter fleet.

Despite these measures, the company is still reluctantly obliged to ask its international cargo customers to bear part of the burden caused by the unprecedented increase in the price of fuel over the past few years.