Just when low airfares were seeping back into the minds of fliers, they have gone back to the rates prevailing before January 21. Leading airlines have decided to withdraw their offers of low fares as they were taking a heavy toll on revenues. Soaring again
The low fares — offered by full service and budget airlines alike from January 21 — were meant to woo back passengers, specially corporate fliers, in the face of the economic slowdown.
“Despite offering low fares, the market did not pick up in January. The number of fliers was six to seven per cent less than the same period last year,” said Ankur Bhatia, executive director, Bird Group, a Delhi-based aviation consultancy.
Base fare offers of Re 0 or Rs 99 have been withdrawn with immediate effect.
Fares in the Mumbai-Delhi sector have gone up by more than Rs 2, 000, compared to fares offered in the past three weeks. However, cheaper fares are still available under advanced purchase schemes (apex fares) for all airlines.
“We confirm that on flights that can sustain higher revenues we have stopped low fares and are concentrating on selling higher fares,” Vijay Mallya, chairman and CEO of Kingfisher Airlines.
Air India spokesman Jitender Bhargava said: “The Rs 99-plus-taxes fares are not available now.” A ministry of civil aviation spokesperson added: “Air India fares are to remain 10 per cent lower than Jet and Kingfisher.”
Low cost airlines are also expected to hike fares. According to SpiceJet CEO Sanjay Aggarwal low fares were unsustainable.