Friday, March 01, 2019

Get ready to face higher air fares

New Delhi: Brace for higher air fares in coming days. Prices of aviation turbine fuel (ATF), or jet fuel, will be hiked by 10% in March. This happens at a time when airlines, led by Jet Airways and IndiGo, are cancelling flights, though for absolutely different reasons. The combined effect, say airline officials, will be lower supply of seats that may enable them to hike fares to absorb increasing costs.

“ATF prices are up again by 10% effective (March). Not good for already struggling industry!” tweeted AirAsia India COO Sanjay Kumar, an industry veteran.

A kilo-litre (KL) of ATF in Delhi and Mumbai for domestic flights costs Rs 58,060.97 and Rs 58,017.33, respectively. This ends a short declining trend seen from last November when the price was Rs 76,378.80 and Rs 76,013.2 in Delhi and Mumbai, respectively.

Jet has grounded 13 aircraft in past month due to default to lessors and some more are not flying for other reasons like snags or awaiting spares. IndiGo has cancelled flights till April due to pilot shortage.
The aggressive growth in last few years, amid a severe airport infrastructure crunch, has led to airlines bleeding badly with Jet and Air India struggling to survive. Rating agency ICRA recently said the three listed Indian carriers — Jet Airways, IndiGo and SpiceJet — lost Rs 20 crore per day in April-September, 2018, period. Collectively, Indian Airlines are likely to lose over Rs 8,800 crore in FY 2019, ICRA had estimated.
28/02/19 Saurabh Sinha/Times of India
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