Travel firms racing to slash domestic tour prices

Travel firms all say they will continue quoting low fees to attract domestic travelers. Home-grown tourists were the main prop of the tourism industry in the aftermath of the world financial crisis, reports VietNamNet.
Several southern firms have announced a 35-40 percent tour fee decrease. A five day tour of central Vietnam (Da Nang – Hoi An – My Son – Ba Na – Hue – Phong Nha) is offered at 3.67 million dong per traveler. A four day itinerary (Da Nang – Hoi An – Ba Na – Hue – Phong Nha) will sell for 3.16 million dong. Pagoda and temple buffs can opt for a six day Hanoi – Ha Long – Trang An – Bai DInh Pagoda – Sa Pa tour costing 5.84 million dong or a four day Hanoi – Ha Long – Trang An- Bai Dinh Pagoda tour costing 4.32 million dong.
Northern travel firms have said they would match the southern companies’ discounts. According to Nguyen Cong Hoan of Hanoi Redtour, details will soon be made public.
The problem is for the tour operators is that they don’t know what hotels will do in response to higher electricity and water prices. Air fares have risen too. Thus Hoan said that despite the discounting, tour fees overall are fifteen percent above 2009 levels.
Airfare is the largest component in the cost of a tour. Vietnam Airlines and other carriers have been granted permission to raise ticket prices to just over two million dong for Hanoi-HCM City flights. Some experts believe that this should be seen as good news, for it allows air carriers to charge a range of fares. It appears that carriers intend to continue deep discounting (up to 50 percent) on many flights.
Round trip tickets between Saigon-Hanoi , Saigon- VInh or Hanoi-Da Lat are now quoted at 1.8 million dong. The promotional round trip fare from Buon Me Thuot to Can Tho has been slashed to 1.8 million dong – still 400,000 dong more than last year.
The sharp competition in Vietnam’s domestic travel market reflects tour operators’ perception that Vietnamese travelers ‘rescued’ the tourism industry in 2009 when international arrivals dropped dramatically due to the global financial crisis.
Vietnam received only 3.8 million foreign travelers last year, 400,000 less than in 2008. At the same time, the number of domestic travelers rose twenty percent to 25 million. Vu The Binh, Director of the Travel Department at the Vietnam National Administration of Tourism, said the net result of these fluctuations was an increase in industry revenues of nearly ten percent.