Airlines hope to see profit with fare hike

New Delhi: With consolidation taking place in the aviation industry, airline companies have hiked their fares by Rs 200 to Rs 300 across all the sectors in an attempt to bring the industry back into black. This is in addition to the Rs 50 increase in the fuel surcharge by all the carriers this month following a 2.8% increase in the aviation turbine fuel prices in July. The trend has really picked up after Vijay Mallya-led UB Group picked up 26% stake in Air Deccan for Rs 550 crore in March end.
"We have increased our fares by Rs 200 on all our flights but that has not affected our load factors at all. Despite the increase in fares we registered over 77% load factor last month. Passengers have accepted the fare hike," a senior executive with a private airline said. "But this is a trend being followed by all the airlines. This had to happen. A price correction was long overdue," he added.
The last three months have witnessed three mergers and acquisitions in the aviation industry with Air India-Indian Airlines, Jet Airways-Air Sahara, Kingfisher Airlines and Air Deccan coming together.
19/07/07 Atreyee Dev Roy/Financial Express

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Categories: General Aviation Jul 2007