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Using the day’s exchange rate to pay

Kenya Airways stick to its guns as some hoteliers complain about dollar fares

Dr. Wolfgang H. Thome, eTN Uganda  Nov 04, 2011

(eTN) - Rumbles from within the tourism industry are slowly emerging over Kenya Airways’ recent introduction of US dollar-based domestic fares, which can be paid with the equivalent of Kenya shillings at the exchange rate valid on the day of the transaction.

“We need to be able to offer packages to the coast, for instance, at a fixed price in Kenya Shillings and clients do not like the uncertainty to be asked for extra money in case the shilling goes down against the dollar, and we also do not like to give the impression we are keeping clients’ money when the shilling goes up, and they have paid a certain amount for their round trip to say Malindi or Mombasa. We were not asked for our opinion, and yet a lot of clients fly to the coast, because we sell them domestic packages. Maybe Kenya Airways could rethink this decision,” said a periodic source from Nairobi when asked for an opinion.

Meanwhile though, a regular source from Embakasi, has as usual on condition of anonymity, insisted it was the right thing to do under the circumstances: “… and our international fares have always been given in dollars, and travelers had to use their shillings at the day’s exchange rate to pay, if they had not changed into dollars already. The domestic market is a difficult one, and we, last year and this year, made fantastic offers for stand-by tickets and for pre-booked and prepaid fares. It is the circumstances, the cost of fuel, which is in dollars, which made the airline reconsider. Depending on where the shilling goes, our passengers may have to put in less shillings, so they can even benefit.”

The emerging arguments, however, also show that the decision was not universally welcomed and other airlines flying on the main jet routes, like JetLink, have vowed to retain a shilling fare come what may, as they are trying to claw back market share through such means, too.

Kenya Airways stick to its guns as some hoteliers complain about dollar fares
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