Domestic airfares may fall by 5-7%

New Delhi: After remaining high for quite some time, domestic airfares are expected to come down by up to seven per cent soon.
Analysts and experts attribute this to a fall in passenger demand by about four per cent in June 2012, compared to June 2011. Consequently, the passenger load factor of the carriers had also started falling due to the end of peak season.
“In a very short time, we can expect that airfares would fall marginally as airlines must be re-configuring their software. This software is adaptable to demand-supply and the concept of dynamic pricing. My guesstimate would be that airfares would fall in the range of five-seven per cent soon,” said Rajji Raj, president of Travel Agents’ Association of India.
All domestic airlines use this software and they follow a principle of dynamic pricing. There are various slabs of price ranges in which a limited number of seats are there. It is a game of demand and supply and the configuration of the aircraft, he added.
22/07/12 Disha Kanwar/Business Standard

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Categories: Indian Aviation- In General Jul 2012