Taipei: Mandarin Airlines is considering suspending its flights between Hualien and Kaohsiung and Taichung, citing low demand and increasing financial losses. Chairman Chen Ta-chun revealed this on Wednesday, highlighting the challenges the airline faces.

According to Focus Taiwan, the airline's load factors on these routes have plummeted to 20-30 percent, with instances such as a Kaohsiung-Hualien flight carrying merely five passengers last year. Chen explained that attempting to sustain these routes is futile, as they could incur losses of approximately NT$70 million annually, given current fuel prices.

The ongoing conflict in the Middle East has exacerbated fuel costs, escalating them from 13 percent to 21 percent of total expenses. Chen cautioned that the airline's losses might reach 10 percent of the projected annual revenue of NT$6 billion due to these increased costs.

Chen pointed out that the airline cannot transfer these costs to passengers since domestic base fares have been static for 26 years. Even with the option to raise fares, the weak demand for the Hualien routes would not support such a move. Previous fare reductions have also failed to stimulate demand, Chen noted.

In contrast, routes to outlying islands are performing well, with Kaohsiung-Matsu load factors at 94 percent and flights to Kinmen nearly full. Chen emphasized the necessity of operating routes to Kinmen, where alternative travel options are limited, unlike Hualien, which is accessible by rail and road.

Currently, Mandarin Airlines operates three weekly Taichung-Hualien flights and daily services between Kaohsiung and Hualien. Chen expressed hope that regulators would approve the suspension proposal, allowing the airline to reallocate resources to more profitable routes and reinstate Hualien flights should transportation disruptions arise.

The Civil Aviation Administration (CAA) acknowledged the situation and indicated it would assess the routes. In Taiwan, any domestic route adjustments require filing and approval by the CAA in accordance with the Civil Aviation Act.