Airlines mum on passing on gains

New Delhi: Domestic oil companies have reduced by more than 3.5 per cent the price that airlines have to pay for aviation turbine fuel (ATF) being procured during the last fortnight of this month, but domestic airlines are not yet passing on the benefit to passengers.
Late on Sunday, Indian Oil announced that a domestic airline re-fuelling at Delhi will now be charged Rs 29.15 for a litre of ATF, down from Rs 30.28 charged in the previous month. In comparison, a customer pays Rs 40.62 for a litre of unbranded petrol in Delhi.
“There are no price changes planned,” a spokesperson of Delhi-based low-cost airline SpiceJet said.
Since late last year, oil companies have been revising the prices of ATF twice a month so as to reflect any variation in the global price of fuel.
Before the move was implemented, the oil companies would review ATF prices once every month.
This practice was changed following an inter-ministerial meeting called to bail-out the airline industry from incurring huge losses mainly on account of rising global crude prices.
But earlier this month, the industry again raised tariffs, forcing the Directorate General of Civil Aviation to question the manner in which the industry collectively took the decision.
16/02/09 Business Line

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Categories: Indian Aviation- In General Feb 2009