Air fares unlikely to head north till Mar

Mumbai: With air fares already at an all-time high on domestic routes, airlines are likely to hold on to current fares in the January-March period, which is usually a lean season for them. Jet Airways, Kingfisher and Air India have raised fares in the region of 20% between October and December last year, as they cashed in on higher demand during the festival season.
Jet Airways, the largest private airlines in India which has a market share of 22%, does not see any immediate revision in its fares, according to a company spokesperson. An Air India official also said that the airline will maintain its competitive fare levels, although it expects a lot of corporate travel to happen.
Says Iqbal Mulla, treasurer, The Travel Agents Association Of India (TAAI), “Fares on full service carriers on the Mumbai-Delhi sector since October 2009 are hovering between Rs 7,000-Rs 10,000 for early morning flights and ranges from Rs 5,000-7,500 for flights between 11 am-12 pm. However, the fares in August and September ranged between Rs 3,000-4,000. The fares have already peaked, it cannot go up further.”
Pradeep Lulla, president, Travel Agents Federation of India (TAFI), said, “Until September last year, fares had gone down below a viable point. Airlines went by the demand-supply theory: the demand went down and hence the pricing was below sustainable levels. As the traffic surged nearly 30% in the October-December quarter, fares shot up and there is no scope for further hike in fares.”
02/01/10 Shaheen Mansuri/Financial Express

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Categories: Indian Aviation- In General Jan 2010