According to the China Air Transport Association, the Civil Aviation Administration of China will intervene in the pricing of 699 routes and ask airline companies not to sell air tickets at less than cost price.
It says that these 699 routes account for over half of all the routes currently run by Chinese airline companies.
CATA says that CAAC will determine a cost price for each of the 699 routes and order airline companies not to sell air tickets below than this price.CAAC will expose airline companies involved in irregularities every 15 days and will punish those that sell air ticket by as a means of unfair competition. Punishments may include, but not be limited to, canceling flights.
Last week, there was a dispute between China Eastern and Air China, Sichuan Airlines and Shanghai Airlines when China Eastern was criticized for offering heavily discounted air tickets. The dispute was later solved with the intervention of CAAC and CATA.
(China Hospitality January 20, 2009)