Buy and Sell for Free! Wednesday, February 23, 2000
fesub.gif (4328 bytes)
Full Story
fe.gif (834 bytes)
India's first e-business paper
flnews.gif (5153 bytes)
Search FE
-
Download
BSE Quotes
NSE Quotes
-
Think Tank
This week we focus on a complete analysis of the
intellectual capital industry
-
 

Hot days ahead for passengers -- IA unlikely to drop summer fares 

Aparna Kalra  
New Delhi, Feb 22: With summer around the corner, are you dreaming of a holiday by the sea with cheap air travel thrown in? Well, this year, you may have to make-do with the Rajdhani.

Consumers are unlikely to reap a windfall this summer as domestic airlines show signs of not biting the bullet on the fares front.

All the three domestic airlines, Indian Airlines (IA), Jet Airways and Sahara Airlines, have stated the season beginning April will not see a drop in air fares in sharp contrast to last summer.

"There is no scope to lower fares. Costs are going up plus the air passenger market is not growing" said a spokesperson of Jet Airways.

IA officials echo similar sentiments. They maintain that a fare drop is not on the cards. "Lower fares are not possible" said IA officials.

More significantly, Sahara Airlines, the up-start airline which trigerred the fierce domestic fare war last year despite its small 5-7 per cent market share, is not planning a fare cut.

"We are not interested in getting into a fare war at all" said Sahara Airways chief general manager Kapil Kaul. The result: consumers can kiss cheap air tickets goodbye. So if you enjoyed a plane ride from Mumbai to Delhi for a very reasonable Rs 3,800 last year, be prepared to fulfil the little-over-rupees-five-thousand demand from your travel agent for this season.

And no dream run to Goa, or Ahmedabad, or Kochi, or wherever.

This, despite the fact that domestic airlines are operating more flights than ever before this year. Jet Airways and Sahara Airlines have increased capacity and while the latter is targetting a 16 per cent market share, the former is attacking the market with a new fleet with an average age of five years.

So, what is the reason behind the airlines' reluctance to effect fare cuts? For one, unlike last year when the air passenger market did not grow at all, the impact of a resurgent economy and booming stock markets is expected to be felt on air travel.

Domestic airlines, therefore, do not feel compelled to employ marketing gimmicks such as fare cuts to attract consumers. The economic turn-around will ensure that the domestic air travel market, stagnant for the last three years, experiences good growth.

A candid Kapil Kaul of Sahara Airlines admitted as much. "This summer we are looking forward to better yields" he said.

Sahara, he added, will continue to give add-ons to its passengers in terms of free hotel stays and airport pick-ups, but fares will not be tampered with. Airlines, however, realise that the consumer has tasted blood. "Last year proved that consumers want value for money. So all airlines now have to work to give passengers the best in the market" said Kaul. So maybe this summer, when you do take the dream holiday, a free valet service, city check-in, on-line bookings and a free hotel stay, may be available to compensate you for the extra price of air travel.

Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.

- Lead Stories | Corporate | Infrastructure | Commodities | Economy/Finance | BSE Today | NSE/ Markets | Strategy | Convergence | After Hours top.gif (150 bytes)Top
flame.jpg (1068 bytes) © Copyright 1999: Indian Express Newspaper(Bombay) Ltd. All rights reserved throughout the world.
This entire edition is compiled in Mumbai by The Indian Express Online Media Limited, a division of
The Indian Express Group of Newspapers. Managed by The Indian Express Online Media Limited and hosted by CerfNet.