The lines between low-cost carriers and full-service ones seems to be blurring, courtesy the loss-making services of private airline Kingfisher and government-owned Air India. The result: On several routes the tariffs of these two full-service carriers are lower than those offered by low-cost carriers like SpiceJet and Indigo.
On the Delhi-Mumbai sector, one of the busiest routes in the domestic market, Kingfisher and Air India are offering fares lower than their no-frills counterparts like IndiGo and SpiceJet. And the difference is quite a bit.
While Kingfisher has priced a ticket for Delhi-Mumbai at over R4,600, Air India is offering it for over R7,300. However, the Gurgaon-based airlines IndiGo and SpiceJet are selling the same for over R7,600. Even on other routes like Delhi-Bangalore, Kingfisher ticket price is a little over R7,500 compared to IndiGo and SpiceJet that are selling it for more than R8,300.
This, however, does not give any advantage to the passengers planning their summer holidays. According to industry experts, lower fares from Kingfisher is a temporary phenomenon and will not influence the pricing of other airlines.
?The low-cost concept is in the minds of people. Low-cost does not mean that the ticket prices would be low. The fares would depend on demand and supply in the market. In case of Kingfisher, they do not have any option other than selling tickets at lower prices,? Vasuki Sundaram, joint secretary of Travel Agents Federation of India (Tafi), said.
The domestic airfares usually go up from April onwards. Even now, they are already up by almost 25% from the March level. They would further increase from April end and May.
?Kingfisher?s is a unique situation. They have to keep their prices low even when they do not make money on it to win back the confidence of their customers. As far as people who are planning to go on summer holidays, the suggestion is to book it fastest,? Richa Goyal Sikri, director (group business development) STIC Travel Group, said.
Another reason why low-cost airlines will not be considering a downward price revision is the demand-supply mismatch. Kingfisher has withdrawn a lot of capacity from the market. It has brought the total number of flights to around 170 daily flights. This has left a huge gap in demand and supply. ?The airlines do see this void and there is no reason for them to cut their fares. The demand will pick up more in the coming months and it?s time for them to have good business,? an airline official said.
