Low-cost airlines pull down global fares

New Delhi: Planning to fly to Kuala Lumpur from Chennai? Book yourself in an Air Asia flight and you have to fork out just Rs 4,100, compared with Rs 8,243 charged by Jet Airways. Also, for a trip to Sharjah from Delhi, Air Arabia charges just Rs 7,659, compared with Jet’s Rs 11,217.
With the percentage of seats being offered by low-cost carriers (LCC) in international routes to and from India increasing from around three per cent (in April 2009) of the total seats on offer to 10 per cent currently, there is welcome pressure on fares from the customer’s point of view.
“The low-cost capacity should increase from 10 per cent to 25 per cent in the international skies in the next few years, as many international LCCs have plans to come to India, and a few Indian LCCs will also do so (that is, fly abroad),” said Ajay Prakash, general secretary, Travel Agents Federation of India.
Various Indian LCCs are launching short-haul international routes, to Southeast Asian and West Asian countries. With fares around 50 per cent lower, the LCCs are obviously attracting customers.
“As the attraction of LCCs is the price they offer, their launch will create an impact on the existing fares and also increase competition for the legacy carriers,” said Centre for Asia Pacific Aviation’s Chief Executive Officer, Kapil Kaul.
International airlines like Air Asia, Air Arabia and Air India Express operate to various destinations in the country and FlyDubai and SpiceJet are to start operations soon.
Currently, Air Asia flies to four destinations and has announced plans to fly to five more places in the country. “Our fares are around 50 per cent cheaper than the legacy carriers operating in these sectors,” said a spokesperson for the airline.
01/05/10 Mihir Mishra/Business Standard

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Categories: Low Cost General May 2010