Fare hikes not enough, says Jet

New Delhi: Jet Airways, the country's largest private airline, has made it clear that the recent five to six hikes have still not brought the industry closer to the break even point.
An additional 15% increase in fares, coupled with several cost-cutting measures by both airlines and the government, are required to help airlines fly out of the red. While cost-cutting steps are being taken care of, fares can go up again next month when the peak travel season begins.
"Even after the latest 10% hike, we are far from being out of the woods. Another 15% hike is needed along with structural reforms. The latter include cost-cutting by rationalizing flights; tax reforms on jet fuel pricing; temporary relief in landing, parking and navigation charges and a freeze on any increase in airport charges, especially at new private airports," Jet Airways CEO Wolfgang Prock-Schauer said.
Airlines also want deferment of user development fee (UDF) at Bangalore and Hyderabad airports. But this is unlikely to happen as civil aviation minister Praful Patel has made it clear that UDF is an essential part of airport developers' revenue model and will have to be levied. And UDF at these airports can take place this month itself, adding to the travel cost of passengers.
04/08/08 Saurabh Sinha/Times of India

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Categories: Jet Airways Aug 2008