Airlines back with discounts; but profitability under pressure

New Delhi: It's raining discounts from the sky, amid a cut-throat competition to grab a larger pie of market share, airlines are offering fares of as low as Rs 500, even though analysts are warning about an adverse impact on bottomlines, already burdened under high fuel prices.
While budget airlines such as Air Deccan, Jetlite and IndiGo are doling out tickets for Rs 500 on various sectors, full-service carriers like Air India are also offering fares as low as Rs 999 for a one-way journey.
Not to be left behind, carriers flying on international routes are giving out discounts up to Rs 5,000 on a ticket, besides offers like free hotel stay and 50-100 per cent waiver on companions' fare being announced by both domestic and international fliers for bulk bookings.
However, at the consumers' end, it is not as rosy as it appears on the ground. The discounted fares of Rs 500 and Rs 999, as being offered by the carriers, do not include taxes, transaction fees, fuel surcharges and other additional costs.
20/01/08 PTI/Economic Times

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Categories: Indian Aviation- In General Jan 2008