New Delhi : The battle in the domestic skies is set to become more fierce. Air India plans to slash fares for tickets booked between five days and the last hour before departure on select routes.
The extent of the cut, said officials, could be up to 15 per cent.
Over 50 per cent tickets are sold during these five days. They fetch the highest margins as their price is two-three times the lowest fares offered on tickets booked well in advance.
For instance, the last-minute fare between Delhi and Mumbai is in the range of Rs 5,700 (Tuesday evening), as compared to Rs 3,733 for a flight that will take off on August 5.
The move will impact other airlines, as they, too, will have to cut their highest fares.
“We aim to fill 80 per cent seats six days before the departure. If this does not happen, we are looking at offering the inventory at lower rates,” said a top Air India official, who did not want to be identified.
He said Air India would not lose as it would get some money from seats that would have otherwise gone empty. “Our planes are flying at a very low load. The aim is to get revenue from empty seats, even if we have to fill them at lower rates,” he said.
The airline has already announced a steep fare cut from May 1. Its lowest fare for the summer season is 15 per cent less than what low-cost carriers are charging.
Air India is the largest airline in the country in terms of fleet, but this does not reflect in the number of passengers carried. It is number four in market share (15.8 per cent), behind Jet, Kingfisher and IndiGo. SpiceJet is close behind, with a 13.8 per cent share.
20/04/11 Mihir Mishra/Business Standard
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