Tuesday, January 31, 2012

What does ALL-IN FARE Really Mean

It depends on who you ask. If you ask an accountant a dollar added to another is equal to $2. But if you ask a marketer a $9.90 merchandise is actually $10.00.

Take the following case and you will understand why the Australian Competition and Consumer Commission, ACCC, filed a lawsuit against Malaysian budget carrier AirAsia. ACCC accused AirAsia of failing to disclose the full price of fares on its website.

So, I did the following:

  • Landed on AirAsia's website
  • Clicked the first promo that appear on the homepage
  • Entered flight details according to the promo T&Cs
  • Presented with total fare

Very attractive, all-in fare starts from RM199.00 although not many seats are priced this low.

Simple, and the offer is looking good! Almost all year around.

To be fair to customers, All-in fare should read as "FROM RM257.50". For obvious reason the airline did not disclose the higher fare when flying back from Tokyo. Interestingly for Gold Coast-KUL-Gold Coast  routes, both fares are displayed prominently.
At least that is my first impression of a return tickets to from KUL-Tokyo-KUL: RM199 x 2

Clearly, RM199.00 is not the all-in fare. Finding out what's the airport fees and taxes in Haneda, Tokyo should not be the customer's, it's the airline duty to disclose them. In this case, only the flight from Kuala Lumpur to Tokyo is correct as per advertised.

I have nothing against AirAsia, in fact eversince this budget carrier started its operations my family has been using its services for leisure travelings, except for routes it has not covered yet. Malaysia Airlines for me is mainly for formal company trips.

The above may not be an exact copy of what happened in the carrier's adverts for it's Australia website but the idea is still the same. The airline's advertisements always get me sceptical as most of the time the final total fare would be much higher than what is written as big prints in their commercials.

We may not have a law specifying "Businesses that choose to advertise a part of the price of a particular product or service must also prominently specify a single total price", but as a responsible business entity this is the right thing to do. Consumers should not be faced with surprises after making online bookings and are ready to make payment.


HoneyBUZZin said...

yea...felt cheated somehow...but it's not just the airlines but also Insurance company..or any agreement you signed..must look out for that 'small' little print that we so often overlook.

Like this entry...

Aki said...

sama kes yang kami mo pigi phuket tu, he he he.. yang balik pigi malaysia mahal ni.. tapi, kira murah sudah, hantam ja la.. :-D

gadisBunga said...

yeah. i like this entry too.

for those who constantly looking for good offer of flight ticket online, normally has already aware on the actual cost behind the price displayed.

but no matter how high the additional cost is. air asia is still cheaper than MAS. cheaper la, but not very very cheap anymore.

gunsirit said...

There is always hidden cost in some Asia Asia's package. Better to check thoroughly before committing yourself to a flight..:)

Meitzeu said...

Interesting explanation by you. Impressive. :D That's their marketing plan which is a smart one. :)

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MaryaYusof said...

Hola de enginuer,

Couldn't agree more...but, somehow I really hope one day there will be routes to Peru-KL (vice versa) with the cheap price...ngeee

Lama tak jln sini, rindu pulak...Tq for the doa :)

sahromnasrudin said...

strategi dlm sebuah perniagaan...tetapi masih murah lagi dibandingkan dengan MAS kan

Angie said...

That's why I never take Air Asia's fare at face value. So many hidden costs. Still, AA has accorded many a chance to travel. Their 'now everyone can fly' I think is still relevant.

thomas said...

It's high time someone sue them,always misleading people with their fares.

de engineur said...

Notwithstanding the misleading adverts I have to agree, as pointed out by some of you, that AirAsia is still the cheaper option compared to Malaysia Airline.

"Now everyone can fly", well almost.