Train Ticket Pricing: Looking for Profit through New Formula

PT Kereta Api Indonesia (KAI) will apply a new system to calculate the tariff of non-subsidized passenger trains or non-public service obligation (non-PSO). KAI President Director Edi Sukmono said that the tariff formula would use a dynamic system and rely heavily on demand, supply, and the capacity of the train available at a particular time.

Edi explained that the new system would be similar to the method used to decide airfares. In a dynamic scheme, the operator would compare the load capacity with the demand at the time. Consequently, the ticket price would follow the increase in demand, usually happened during the holiday or weekend. In contrast, the price would go down during the low season. The earlier the customer books, the cheaper the seat will be and vice versa.

However, to control the price from wild fluctuation, the government will impose the price floor and ceiling system. The dynamic tariff will only apply on the long-distance trains or inter-city trains, especially for the executive, premium, and business class, as well as specially designed armada such as airport trains. While the PSO trains, such as Commuter Line, economy class long to medium distance trains, and Lebaran trains, will use fixed pricing.