Kingfisher’s indecision is Jet’s gain

Mumbai: It's been a good new year for air travellers. As aviation turbine fuel (ATF) prices fell sharply last year, most airlines reduced their fares during the new year. But Kingfisher’s yet to come up with a fare cut announcement.
In fact, Kingfisher’s delay in announcing the percentage of fare cut has benefited Jet Airways. Passengers have quickly moved over to Jet, and have started bookings tickets on sectors where both airlines have flights. It’s not yet known why the delay in announcing the cuts but an industry source said there were some miscalculations between Jet and Kingfisher alliance on the fare cut decision.
It was learnt that Jet-Kingfisher alliance had agreed to similar amount of fare cuts to be implemented on the same day. But now, Kingfisher is considering both basic fare and fuel surcharge cuts of around Rs 600 and Rs 400, respectively, which would be implemented next week, the industry source added.
There will be some difficulty for the Jet-Kingfisher alliance on route-sharing and capacity-reduction fronts as different fares in the same route-class between them may create tension, said an analyst on condition of anonymity.
Other full service carriers like Jet Airways, Air India have reduced basic fares only in the range of 40% to 82% from Monday and Tuesday, respectively. Last October, Jet and Kingfisher had formed an alliance to share resources and cut capacity to save cost.
02/01/09 Mithun Roy/Economics Times

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Categories: Jet Airways Jan 2009, Kingfisher Jan 2009