Mumbai: The recent airfare hike followed by decisions of some hoteliers to increase the average room rate is likely to impact the domestic tourism market, starting next month, with the budget of the travellers getting stretched by 35-40 per cent.
The increase in hike is partly due to the hike in aviation turbine fuel (ATF), which is forcing the industry to pass it on to the consumers, feel industry experts.
“This increase is due to cost pressure and not because of a demand growth. With the recent ATF hike along with a depreciating rupee, the airlines are forced to pass on this cost increase to consumers. However, this increase is not sufficient enough to compensate for the cost hike,” Rashesh Shah, research analyst, ICICI Direct, told Financial Chronicle.
08/09/13 Soummnly Kanungo/mydigitalfc.com
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The increase in hike is partly due to the hike in aviation turbine fuel (ATF), which is forcing the industry to pass it on to the consumers, feel industry experts.
“This increase is due to cost pressure and not because of a demand growth. With the recent ATF hike along with a depreciating rupee, the airlines are forced to pass on this cost increase to consumers. However, this increase is not sufficient enough to compensate for the cost hike,” Rashesh Shah, research analyst, ICICI Direct, told Financial Chronicle.
08/09/13 Soummnly Kanungo/mydigitalfc.com
