AirAsia MOVE to appeal P6 million fine, insists 'excessive' fares came from third-party providers
AirAsia MOVE, the online booking platform of budget airline AirAsia, will appeal the P6 million fine imposed by the Civil Aeronautics Board due to "excessive and unreasonable airfares."
In an interview with reporters, Tony Fernandes, chief executive officer of AirAsia MOVE’s parent company Capital A, lamented the steep penalty and insisted that they didn't overcharge customers.
“I’d rather put that P6 million into investing and bringing more people here. If you want me to put P6 million into a fund to invest and promote the Philippines, I’ll do that because that’s proactive and beneficial," he said.
Fernandes stated that the alleged inflated fares didn't originate from AirAsia MOVE but were supplied by third-party providers and processed by an algorithm.
“We will take some liability because the fares were on our website, but our mitigating circumstances—one, it wasn’t our fare," he said. "What happened is the consolidator pushed a fare to us. We can’t check every fare; there are millions of fares out there."
Fernandes insisted that they don't know what happened as "everyone's denying it," but vowed to "put something into the system to cap it so it can't ever happen."
“We don’t know whether the algorithm and the middleman decided to see that there was a problem between that bridge and whacked the price up," he said.
Fernandes called on local airlines to work directly with AirAsia MOVE to avoid getting fares from middlemen moving forward.
“We have been asking airlines to sign up directly with us," he said, "as all airlines here have direct relationships with other (online travel agencies) as well."
Before imposing the P6 million fine, CAB filed a cease and desist order against AirAsia MOVE on May 26.
AirAsia MOVE's case stemmed from the complaint by Leyte 4th District Rep. Richard Gomez and his wife, Ormoc Mayor Lucy Torres-Gomez.
Through the platform, they booked two one-way flights from Tacloban to Manila via Philippine Airlines worth P77,704, or nearly P40,000 per ticket. But on the Philippine Airlines website, Department of Transportation Secretary Vince Dizon pointed out that the flights should have cost P49,507.
AirAsia MOVE Chief Executive Officer Nadia Omer then explained that it "does not manually set or manipulate airfares."
"As an online travel agency, MOVE displays flight inventory and pricing data as provided by its authorized upstream suppliers, including third-party aggregators and global distribution systems," she said in a statement last June 2.
"The discrepancies in fare displays for certain routes, including domestic flights operated by Philippine Airlines, were caused by temporary data synchronization issues with flight pricing partners," she added.
Omer noted that the technical discrepancy wasn't isolated to MOVE as it also affected other booking platforms across the industry, including Agoda, Kiwi.com, and Traveloka.
At the time, she said the company brought up the matter with its third-party pricing provider for immediate resolution and that it's "fully compliant with all regulatory requirements applicable to online travel agencies."
AirAsia Move brands itself as the "ultimate travel app for flights, hotels, and more, designed to take you everywhere you want to go." Its services include flight bookings from over 700 major airlines on top of AirAsia and 900,000 hotels worldwide, as well as ride-hailing, dining experiences, insurance, duty-free shopping, and more.