Peak domestic airfares set to fall as DGCA cracks the whip

New Delhi, June 18:

The skyrocketing fares in the domestic skies are set to ease soon. At a recent meeting with the civil aviation regulator, airlines assured the Director-General of Civil Aviation that domestic airfares at the highest level will fall 5-20 per cent across the network in the next few days.

“When a request is made in public interest by the DGCA, almost all airlines follow it. There will be a reduction in fares in the next few days. Watch the airline Web sites and the lower fares will be visible,” the D-G, Mr Bharat Bhushan, told Business Line.

At the meeting it was pointed out that although price of aviation turbine fuel had gone up by about 16 per cent in June as compared to the same year previously, the average increase in airfares had been “phenomenal”.

Similarly, even though the number of passengers flying domestically had declined in May there was a disproportionate spurt in airfares. The huge variation in the highest published airfare by different airlines on the same sector was also flagged by Mr Bharat Bhushan. Travel agents point out that there has been an increase of between 20 and 30 per cent in domestic airfare in the last 2-3 months. On the Delhi-Chennai sector alone, fares vary between Rs 8,000 and 23,000. Earlier, the same flight could be had for Rs 6,500-Rs 7,000.

The fact that a passenger buying a ticket in advance might pay more than a flyer who buys at the last minute was also raised at the meeting. Officials indicated that this was because airlines opened bookings at the highest fare level and then lowered the fares as the departure date neared.

Airlines cited the depreciation of the rupee against the dollar and the fact that almost all the players were losing money among the reasons for fares heading northwards since April this year.

The meeting was attended by the Chief Executive Officer, Jet Airways, Mr Nikos Kardasis, the Chief Executive Officer, Kingfisher Airlines, Mr Sanjay Aggarwal and the Chief Commercial Officer, IndiGo, Mr Sanjay Kumar, among other senior officials.

http://www.thehindubusinessline.com/todays-paper/tp-economy/article3545408.ece