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SpiceJet boss says no option but increase fares by 10-15% 'immediately'
A minimum 10-15 per cent increase in air fares is required to ensure that cost of operations are better sustained, news agency ANI quoted Ajay Singh, chairman and managing director, SpiceJet, as saying.
Air travel is expected to get expensive amid a sharp rise in jet fuel price and depreciation of the rupee, which has also led to an increase in operating costs of already Covid-19 ravaged airlines, prompting SpiceJet to issue a warning on Thursday.
A minimum 10-15 per cent increase in flight fares is to be expected, the airline further said, adding they have been left with no choice but raise fares "immediately". A minimum 10-15 per cent increase in air fares is required to ensure that cost of operations are better sustained, news agency PTI quoted Ajay Singh, chairman and managing director, SpiceJet, as saying.
He reasoned that aviation turbine fuel (ATF) has risen by over 120 per cent, which he said, was not "sustainable". He also urged the centre and state governments to intervene and provide tax relief on ATF.
Oil marketing companies have hiked ATF by 16.3 per, with the fuel now costing an all-time high of ₹1.41 lakh per kilo litre in Delhi. Since 2022, ATF prices have increased every fortnight.
“ATF prices have increased by more than 120 per cent since June 2021. This massive increase is not sustainable and governments, central and state, need to take urgent action to reduce taxes on ATF that are amongst the highest in the world," he said.
"SpiceJet has in the last few months tried to absorb as much burden of this fuel price rise, which constitutes more than 50 per cent of our operational cost, as we could,'' he added.
"The weakening of the Indian rupee against the US dollar further significantly impacts airlines as our substantial cost is either dollar denominated or pegged to the dollar."
