Air Strike: Carriers fly past Rajdhanis in fare war

New Delhi: New airfares effected by low-cost airlines following the sharp fall in jet fuel prices are now closing in on the country’s busiest Delhi- Mumbai air route, air tickets are now available at prices up to 25% cheaper than Rajdhani fares. When compared to first class AC fares, the airfares are up to 48% lower.
For instance, SpiceJet is offering Mumbai-Delhi air tickets for Rs 1,575 (inclusive of fuel surcharge and taxes) compared to second AC fares of Rs 1,975 charged by Rajdhani Express on the same route. When compared to the first class AC fare in Rajdhani trains on this route, airfares offered by IndiGo and SpiceJet are up to 50% cheaper.
The party, however, may not last. “The air fares currently being offered by us is designed to stimulate the market. The idea behind offering these promotional fares is to convert passengers from other modes of transportation to air. These fares would, however, not stay for long as it is not sustainable,” a SpiceJet official, who did not wish to be named, said.
High aviation turbine fuel (ATF) price, which reached a peak of Rs 71,000 per kilo litre, forced airlines to increase fares by raising fuel surcharge and this resulted in a sharp fall in air passengers.
While air traffic during April-November dropped by 4%, number of passengers travelling in air-conditioned bogies of trains increased by 18.33%. Railways’ earnings from the three tier AC categories during this period grew by 25% to Rs 3,135 crore.
30/01/09 Nirbhay Kumar/Economic Times

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Categories: Indian Aviation- In General Jan 2009