Travel agencies exploit flight shortages

As the prices of flight tickets skyrocketing at abnormal level due to the Chinese government restrictions on the number of flight and seat in key routes, consumers are increasingly angered by travel agencies’ price gouging practice where they sell the tickets at three or sometimes even four-times higher prices from their original purchases.

According to sources from airlines and travel industries on Wednesday, the prices of flight from South Korea to China are two to 10 times higher than the announced price by the airliners. The ticket from Incheon to Beijing used to be available at 500,000 won but recently many customers had to pay 1.5 million to whopping four million won to get them. Flight ticket to Qingdao used to be available at 200,000 to 300,000 won before the Covid-19 pandemic, but is now being sold at 1.5 million won or higher. A number of complaints have been posted on travel related online communities, reading “The ticket price I bought from a Chinese travel agency was unreasonably expensive,” “three or four times more expensive tickets are nothing, there are much more expensive ones,” or “each travel agency offer completely different price levels.”

The initial cause of this price gouging comes from continuing imbalances between the supply and the demand as the Chinese government has regulated the number of flight and passenger per flight for the country’s each district. In airports of Beijing, Qingdao, Yantai, Weihai, Tianjin and Guangzhou and others, each carrier is now allowed one international flight per week, or the passenger can be filled at only 70 percent of the plane’s capacity.

On top of this, some Chinese and Korean travel agencies are capitalizing on the situation. Airlines can only sell their tickets at the price they reported to the relevant authorities. Travel agencies, however, often secure seats by signing contract with the airliners or make advance purchases before ordinary passengers do, and raise the ticket prices. The agencies sometimes sell the tickets to one another to up the price, which leave the actual customers no option but to buy the tickets at high price.

Some agencies use the tactic of setting the fee for ticket refund and change unreasonably expensive. Mr. A, recently purchased a flight ticket to Beijing at two million won, and wanted to make to changes to his itinerary. To his surprise, the agency charged two million won to make the change. The fee was not added on when the airliner made the sale but the travel agency set the extra fee at their discretion.

“It is not easy to control these irregularities because the airliners and the government cannot restrict the ticket price,” said a source from Korean air travel industry. “This situation will persist as long as the supply cannot meet the demand.”

“While the government cannot interfere with the travel agencies’ price gouging practices, it can still play a mediator’s role when it comes to the activities unfavorable to consumers,” a source from Korea Consumer Agency advised. “Reading the fine letters when buying the tickets is important. Also, having proof of unfair practices, in a form of voice recording or contract, will work favorably to get the reasonable refund or for mediation process with the seller.”


bjk@donga.com