Indian domestic airlines are set to increase airfares as a result of the latest hike of 2.5 percent in aviation fuel prices by the state-run oil marketing companies (OMC), as per reports.
Airlines have started raising fares after oil companies hiked aviation turbine fuel (ATF, jet fuel) prices. Jet airways has increased fuel surcharge by Rs 200 on its domestic flights from Saturday. Other domestic airlines are going to follow suit, but in a staggered manner over next few days to avoid charge of cartelization.
However, the pinch could be more than Rs 200 effectively in the coming festive season. While airlines announce hikes in fuel surcharge when jet fuel gets dearer, price movement in basic fares follows a complex bucket system, which keeps going north as seats get sold. So in peak travel season when the demand is high, basic fares would be at the higher levels too. Compounded with higher fuel surcharge, flyers can look forward to substantially costlier air tickets.
"This (rise) may happen as the fuel prices are up again. But we have to see what the other industry players are doing and only then we will go ahead with any such hikes," a senior Air India official said on the condition of anonymity. The industry may see this as a good opportunity to raise prices to offset inflationary pressures, he said. "I do not think a slight price increase would dampen load factors as the festive season is about to begin," the official added.
» Read Complete News.....(You need to login first to read complete news). New User? Register for FREE!
» Back to Travel News