Oil surge fallout: IndiGo flight tickets to get costlier by 200-400 rupees
The airline also cited depreciation of the Indian rupee as an additional cost burden on domestic carriers already affected by the sharp uptick in the price of aviation turbine fuel.business Updated: May 30, 2018 12:35 IST
Passengers travelling on IndiGo will have to shell out an additional sum of Rs 200-400 per ticket as the airline has decided to levy fuel surcharges to counter the recent surge in oil prices.
“In the wake of a sharp uptick in the price of oil and cost of aviation turbine fuel (ATF), IndiGo has decided to reintroduce fuel surcharges effective May 30, 2018. Aircraft fuel expenses represent the single-largest item on our total expenses, accounting for around 40% of the cost of operation,” read a statement from IndiGo, which happens to be India’s largest domestic carrier.
The airline also cited depreciation of the rupee as an additional cost burden on Indian carriers. “Given this scenario for a low-cost airline, levying a surcharge has become inevitable. A sum of Rs 200 will be added on routes that are less than 1,000 km in distance, and Rs 400 on routes longer than 1,000 km. The surcharge will be applicable on all domestic trips, and will come into effect on the midnight of May 29, 2018,” it said.
IndiGo chief commercial officer Sanjay Kumar maintained that the airline was being forced to pass some of the increased cost burden on customers because ATF prices in India have risen by around 25% in the current month when compared to the same period last year, and is at the highest level since 2015. “In the context of the past decade, where airfares in India have come down by nearly 50% in real terms (i.e. adjusted for inflation), we are confident that this marginal increase in the form of fuel surcharge will not have a significant impact on demand,” he said. “We are hopeful that the 1.5 lakh-plus passengers flying with IndiGo each day will continue supporting us.”