AirAsia Move fine-tuning app amid ticket pricing probe
AirAsia Move is working with industry regulators in crafting plane ticket pricing guidelines after recently facing overcharging allegations.
In particular, AirAsia Group’s online travel agent (OTA) platform is collaborating with the Department of Transportation (DOTr) and Civil Aeronautics Board.
Nadia Omer, CEO of AirAsia Move, told reporters on Thursday they were also developing a technology to cap the prices of plane tickets being sold in their app.
Omer said they were not aware of the price ceilings being imposed on the tickets. She said that airlines usually set the prices for the seats. AirAsia Move spokesperson Ana Alexandra Castro explained that third-party suppliers buy the tickets in bulk.
These will be then sold via OTA platforms like Move. Move only serves as an online marketplace for travelers, Castro said.
Omer pointed out they do not use dynamic pricing—or demand-based pricing. Instead, the company takes about 2-percent to 3-percent commission fee.
This means the company does not earn from the ticket purchases. “If I add another layer of dynamic pricing, then the volatility of the rates will be even higher,” Omer explained.
The Move CEO said they are averse of high ticket prices as this may discourage travelers’ purchases. “OTAs want the cheapest prices to be there and the money is earned on the number of bookings rather than the commission per booking. That’s the model,” she explained.
On Thursday, Omer attended a hearing with government officials to investigate the overcharging allegation. “I’m happy to say that though the discussion was tough, the dialogue has started,” she said. Another hearing is set at a future date to further look into this matter.
On Monday, the DOTr flagged AirAsia Move for allegedly selling plane tickets at “unreasonably” high prices. The company attributed this to “temporary data synchronization issues with flight pricing partners,” which has since then been resolved.
