Most frequent flyers are probably familiar with ‘Fuel Surcharges’. These days, for cash fares, they are generally included in the ticket price so they tend to be a bit invisible. For redemptions it’s a bit different. If you redeem on an airline such as Qantas you may find you are up for a fuel surcharge (although these days, it often goes under the more neutral name of Carrier Imposed Surcharge, without even a reason for the surcharge)
The problem with these surcharges is that your “free” ticket ends up having hundreds of dollars in taxes, fees, and surcharges added on top. When an airline imposes a fuel surcharge, it is often the biggest component of the cash payment.
Some countries placed restrictions on the airlines ability to add such a surcharge. For the last few years this has include Hong Kong. This has been a boon for frequent flyers – you could book an award ticket out of Hong Kong, and not get slugged the fuel surcharge.
Hong Kong ending fuel surcharge ban
Hong Kong has announced that it will no longer ban the practice of adding a fuel surcharge. The changes arrived in an announcement regarding the need to advertise fully inclusive prices. These changes come into effect on November 1, 2018.
Under the new display requirements, airlines are required to show the fully inclusive price. This must be the total of all the ‘must-pay’ components of the fare. They will also be required to show a breakdown of all elements in that fare.
How will airlines respond?
The new rules have only recently been introduced, so there has not been any formal announcement from the airlines as yet. One would think, however, that airlines that currently charge Fuel Surcharges in other markets will commence charging the surcharge ex-Hong Kong.
We will wait and see how such airlines respond. Airlines that levy surcharges on redemptions include Qantas, Cathay Pacific, British Airways and Emirates. On the other hand, it may not affect Velocity redemptions, as these do not typically include a fuel surcharge.
Fortunately, there are five weeks until these changes kick in. It may be worth looking at your options if you’ve been thinking of using your points through Hong Kong.