New Delhi: With crude oil price crossing USD 100 per barrel mark, the airlines have begun to pass some of the cost on to the consumer to meet the increased air turbine fuel expenses, and asked the government to take steps to reduce the cost of aviation fuel.
Low cost carrier, SpiceJet has raised the fares by a couple of hundred rupees and is reviewing it on a daily basis while Kingfisher has also sufficiently hiked the fuel surcharge.
Terming the present crude prices as "unsustainable" for airlines' survival, SpiceJet CEO Neil Raymond Mills said, "We have already started passing it (burden of high crude prices) on to the customer. We have started with an increase of a couple of 100s of Rs per ticket but to be very honest this is only the beginning... It is getting really uncomfortable..."
Mills said some of the cost will have to be passed on to the consumer and some of it will have to be borne on our own, we'll have to manage it on a day-to-day basis.
"Pricing (of tickets) is dynamic. It's changing everyday, it is not absolute or same across the board. At current levels of crude, airfares must be hiked by Rs 600-700 to break even," he told reporters on sidelines of "India Aviation Meet " on 'Creating an Economically Viable, Sustainable and Inclusive Aviation Sector' by CII.
Kingfisher airlines has also sufficiently raised fuel surcharge to offset some of burden increased ATF prices.
15/03/11 Economic Times
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