The first-quarter American Express Airfare Index for Asia Pacific found that first class and business class fares from Hong Kong increased by 0.5 percent and 1.2 percent compared with the previous quarter, though full economy and discount economy fares both slipped by 0.1 percent.

When compared with the first quarter of 2004, first class, business class and full and discount economy fares were up by 0.8 percent, 1.7 percent and 0.2 percent, respectively.

Countries, such as Thailand and Indonesia, which were hard hit in the December 26 Indian Ocean tsunami disaster, saw virtually no increase in airfares quarter on quarter.

The index tracks fares for 165 city-pairs in 11 countries, including Japan but excluding the mainland.

Robert Tedesco, head of consulting services at American Express, said regional airfares were influenced by a combination of factors, including the Indian Ocean tsunami, high oil prices and changes in airline services, pricing strategies and fare rules.

``Several Asia Pacific routes have seen changes in airline offerings in recent years, with first class cabins being removed on a number of routes and sleeper seats being offered on long-haul routes in first class and several business class cabins,'' he said.

Tedesco said the weakness of the US dollar helped cushion the oil shock for many carriers.

But pressure to raise fares could come in the second half of 2005 if oil prices stay high and the US dollar continues to strengthen, he said.

The survey indicated that fare increases from the previous quarter were mild everywhere except India, where first class and business class tickets rose 2.4 percent and economy rose 3.8 percent.

The same increases applied when this year's first quarter compared with last year's.

The year-on-year comparisons showed significant fare increases in Australia and Malaysia.

In Australia, first class ticket prices climbed 3.7 percent while business class jumped 6.5 percent, full economy rose 3.8 percent and discount economy soared 11.9 percent.

In Malaysia, first class and business class fares both rose by 8.2 percent in the course of the year, while full economy and discount economy fares were up by 7.4 percent and 7.5 percent, respectively.

danny.chung@singtaonewscorp.com