New Delhi: Air India (AI) has triggered a price war in the domestic skies.
For the peak summer season, starting May, the airline is offering fares that are up to 15 per cent less than what low-cost carriers (LCCs) are quoting. This has been prompted by its new strategy to raise the passenger load factor (PLF) to over 80 per cent and regain lost market share.
Air India is at the number four slot in market share (15 per cent), behind Jet, Kingfisher and IndiGo. SpiceJet is close behind, with a 14 per cent share.
At present, Air India’s PLF is in the 60s, the lowest among all airlines. The industry average is 75-80 per cent.
“We’ve cut fares in our lowest buckets, so that we come across as the cheapest option when customers compare fares. The aim is to increase PLF and fill more seats,” said a senior AI official.
In various sectors, AI’s PLF is less than 50 per cent. With this price cut, it would go up to 80 per cent, the official said.
18/03/11 Mihir Mishra/Business Standard
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