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In a shocker for many domestic flyers, air fares shot up by almost 20 per cent between Monday and Wednesday, as oil companies raised the price of air turbine fuel (ATF) by close to seven per cent.
Fares have increased not only for last-minute tickets, but also for those purchased in advance.
According to travel agents and tour operators in Mumbai, high traffic sectors, such as Mumbai-Delhi, Delhi-Bangalore and Mumbai-Bangalore are seeing the maximum increase in fares.
For example, on the busy Mumbai-Delhi sector, average fares, which were Rs 4,200 on Tuesday, have shot up to Rs 5,500.
“Usually fares go up from October, once the festive season begins,” said Sharat Dhall, COO, Yatra.com. This time, however, the fares have gone up much earlier.
Fare correction
Some in the travel industry see the increase in fares as a correction, as during July and August, these were down by 20 per cent compared with last year.
August and September are generally the leanest months for air travel when fares normally fall. Interestingly, last year, the fares did not come down even in the off-season.
“This was due to the drop in overall capacity following the halt of operations of Kingfisher Airlines,” Dhall added.
The hike in air fares this year is being seen as a combined result of the depreciation in the rupee and the resultant hike in jet fuel prices.
“This scenario leaves the airlines with no other option but to pass on this increase, partially or fully, to consumers,” says Vikram Malhi, General Manager, South and Southeast Asia, Expedia, a travel firm.
To make matters worse, tour operators fear that this may just be the beginning of fare hikes for the season.
“As demand increases in the peak travel season (October-December), we expect the fares to go up further by another 15 per cent,” says Sanjay Bhasin, Managing Director, Goibibo.
According to a senior airline official, this year the domestic airline industry has been following “no rationality” in the pricing of air tickets.
“What started with a low-cost airline launching a reduced fare scheme in February, continued through the year with a full service airline launching its own discounted fare scheme in August. All this has impacted the market with almost all airlines looking at taking steps to protect their bottomlines,” the official said.
>nivedita.ganguly@thehindu.co.in
>ashwini.phadnis@thehindu.co.in
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