Lylating The Proposal Of Applying The Flight Price Floor

The discussion restarted the post-stage economic activity of stress to prevent Covid-19 epidemic. Right now, the scenario that applies the floor price floor (minimum price) continues to be released to 9: 00/6: 41 NORTHING SOUTHERS with last time, this proposal has a more "heavy" section when ants The proposal was sent to the Ministry of Transport and the Ministry of Transport. According to the Aviation Administration, this petition was mainly initiated from the actual decline in output and aviation business activities due to the negative impact of Pandemic Covid-19 From the beginning of 2020 so far. Whether the proposed policy applies to temporary properties (by the end of October 2022), the arguments that the Aviation Administration does not seem to be truly convincing. The workers often apply lower policies Fares to maximize the performance of using the number of seats on each flight

. The backwards of the minimum price of theoretical faces, when the minimum price is applied, the opportunity to approach cheap aviation products is no longer available, Sales of airlines may be reduced due to the decrease in customers. At this point, the airlines expect to offset the decline in sales for this reason by sales increase from the ticket sales at a minimum price for the few customers with more financial conditions. However , stemming from the characteristics of the industry, aviation service business is a "block" sales operation with high fixed costs
Specifically, even if the number of tickets sold on a non-much flight, it is still forced to take off. If the minimum price policy is applied, the distinguished valuation mechanism for a low price ticket for the remaining seats cannot occur. It is worth mentioning, in its argument, the Aviation Administration has notified That, the past time, airlines are forced to maintain a fleet with almost fixed quantities, even a much higher growth rate than flights from 2019 and earlier. As a result, the carriers often apply ticket prices to maximize the performance of using the number of seats on each flight. Normally, the price policy of the carriers always has a clear classification and classification. Then, as said, when the minimum price is applied, this business method no longer exists, the opportunity to increase sales and "pick up" more sales have been deprived. Even the ticket sales strategy 0 copper as a product marketing method also dissolves. So, apply the minimum price, at least in this perspective, will not be sure to help firms increase sales as well as business efficiency. In that time, despite not, when the minimum price is applied Applying, competitive pressure in the air market will decrease. First of all, this deprives the opportunity to approach cheap products (below the long-term price) consumer
But most importantly, the competitive strategy of the price of the business is also lost. So, at a homogeneous minimum price, the competitive battle between firms will revolve around other competitive advantages and often leans on brands with brands, where cheap products are only ... in dreams. So, both theoretically and in fact, the minimum price policy usually only applies in the market where the competitive price (low) can cause a negative impact on the side ... weak. Protection of farmers in the market to buy agricultural products is the most a good example. If approaching in the opposite direction, something is somewhat incredible when applying the minimum price policy in the output market such as aviation fields. Need to pay more, different from the business activities Other products, flight services are business products that must meet the strict standards, standards and conditions for technical and safe flying. So, cheap arguments are poor quality goods will not match Suitable for aviation service. It is possible that passengers buy cheap tickets without access to luxury service but at least they also use the service to fully meet the minimum safety conditions. So, the left worries of cheap competitive strategies seem to have an unpleasant part and thinking. Competition in the airline market has "excessive"? Even so, there is a situation where State intervention in the process of competition, including competition in prices as just said, may occur. It is when the competition on the excessive market (excessive competition), can cause reverse impact. As a result, weak businesses, shortness of slightly opposite the risk of bankruptcy and can actually began to bankrupt without proactively abandon the market soon. For so, as opinions of the Ministry of Transport Loading, the most needed at this time is the right-to-market, competitive performance, the business situation of firms so that there may be a most suitable option. In many situations, due to the market There is a high competition so the investment attraction strategy has many obstacles. The reason, investors often find attractions in a market that force them to pay too much to compete and survive. But vice versa, the participation is too easy and crowded New competitors will increase the quantity quantity

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