Foreign airlines drop peak-season airfare

Mumbai: With lower oil prices and slumping demand for air travel, airlines across the United States and Europe have dropped peak-season air fares, hoping to bring in a rush of last-minute holidayers to fill up empty aircraft. In India, however, despite a fall in passenger traffic as well as ATF prices, air fares continue to stay north.
A Mumbai-Delhi ticket for Thursday mid-week fares on this route should be on the lower side started at Rs 4,937 for Go Air, a low-cost airline; for full-service carrier Air India, it was Rs 6,395. The high fares are an index of the high fuel surcharge at a time when ATF prices have hit the bottom of the barrel; it now comes between Rs 32 and Rs 38 a litre, the lowest it has fallen in the last three years (see box on top).
In December 2005, when ATF cost as much as it costs now, a Mumbai-Delhi low-cost carriers ticket came at Rs 1,000. Even last December, when fuel surcharge was Rs 1,650, mid-week tickets on this route started at a low of Rs 1,900. There is no justification for airlines to levy a fuel surcharge. This came into existence 18 months ago.
But ATF is now cheaper than what it was three years ago, Air Passengers Association of India chairman Sudhakara Reddy said. Civil aviation minister Praful Patel has been urging airlines to bring down fares but none has bitten the bullet so far (though airlines brought down the fuel surcharge by Rs 400 after Air India took the step).
Airlines were expecting the government to put ATF under the declared-goods category in December but that decision has been put on hold.
17/12/08 Manju V/Times of India

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Categories: Foreign Dec 2008