Airfares in India up as carriers drop promotional schemes (Lead)

February 10th, 2009 - 7:10 pm ICT by IANS  

New Delhi, Feb 10 (IANS) Indian carriers, including budget airlines, Tuesday decided to withdraw their promotional fares, which in some cases were as low as Rs.99 excluding taxes, and hiked their base tariff by up to Rs.2,000 per ticket on some sectors.

The steepest hike of between Rs.1,800-Rs.2,000 per passenger was expected on the Mumbai-Delhi sector, airline industry sources said, adding it was difficult to quantify by how much the fares will be up on individual routes.

“We have discontinued our promotional fares,” said a spokesperson for the state-run carrier, Air India, which was the first along with Kingfisher Airlines to announce the major hike in airfares.

“The response has not been very good. But people who have already bought tickets under the scheme will enjoy the benefits,” he told IANS.

“We have closed low fare buckets and are concentrating on selling higher fare buckets. Our focus is on revenue and not seat factors,” said a spokesperson for Kingfisher, even as officials at SpiceJet, Indigo and GoAir also said they were hiking their base fares.

For outbound passengers from the national capital, the fare hike comes on the back of the civil aviation ministry approving what is called the user deficit charge payable to the airport developer to meet their funds shortfall for the ongoing upgrade programme.

The charge amount to Rs.200 per passenger on domestic routes and Rs.1,300 for overseas.

Barely 10 days ago, Air India had offered an economy class ticket at Rs.99, plus the Rs.3,024 fuel surcharge, on all domestic sectors till Feb 28, and said this tariff will be available beyond this date to passengers who book 21 days in advance.

Prior to that, Air India, Jet Airways and Kingfisher were among the carriers that had cut fares in the last week of December by 21-82 percent, mainly on metro routes because of the successive cuts in prices of aviation fuel.

Aviation fuel constitutes between 30-40 percent of an airline’s operational cost.

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