Carriers raise fares after hike in jet fuel prices

New Delhi, May 30: | Updated: May 30 2008, 20:14pm hrs
The hike in jet fuel prices have led Indian carriers to raise fares, including fuel surcharges, on the basis of distance travelled, with some carriers also trying to consolidate their flight schedules.

While the published fares in India rose by six per cent, they were increased by two per cent in the domestic sector, nine per cent in intra-Asia and 32 per cent to the Americas, a recent survey by the American Express said here.

However, on a quarter to quarter comparison, discount economy fares decreased by 11 per cent which is expected to be a temporary trend, the study by American Express Asia Pacific Business Travel Monitor said.

Observing that flights originating in Asia Pacific and going to the Americas and intra-Asia Pacific destinations were fuelling the overall rise, the study said the domestic air fares as well as international ones were rising due to the jet fuel price hike.

Most major airlines seem to be focusing on taking advantage of a robust India market to help sustain or grow their bottomline, Manoj Chako, Head of the AE Business Travel in India, said here.

He said Indian carriers were now following the global tiered fuel surcharge model based on distance flown.

Aviation industry sources said some of the airlines were also planning to consolidate their flight schedules, by cutting some flights to certain select destinations.

Indian carriers were also focusing on getting their products to a global standard and consolidating their domestic market, the study also pointed out.

Fuel costs, which account for almost 40 per cent of the total operating costs of airlines in the country, was adversely affecting their financial strength.