The Directorate General of Civil Aviation on Wednesday (March 18) issued a directive requiring airlines to allocate at least 60 percent of seats on all domestic flights for free access. The aviation regulator also asked carriers to seat passengers traveling on the same booking reference or Passenger Name Record (PNR) together, preferably in adjacent seats.
The government’s recent decision comes in response to a surge in passenger complaints regarding the limited availability of free seats during web check-ins and sustained pressure from consumer groups and the Ministry of Consumer Affairs.
Consumer Manipulation
The Consumer Affairs Ministry had in October 2023 raised concerns, with then Consumer Affairs Secretary Rohit Kumar Singh calling the practice of labeling every seat as paid an unfair trade practice under the Consumer Protection Act. Singh termed such tactics as “dark patterns” that manipulate consumer decision-making, pointing out that airlines were structuring their website interfaces to undermine consumer autonomy.
Similarly, Many travelers had reported that in many cases, nearly all available seats are subject to charges, leaving only a few middle seats at the back of the aircraft as complimentary choices. Parents, in particular, highlighted the difficulty of being separated from young children unless they paid for seat selection. While the DGCA had previously mandated in April 2024 that children under 12 must be seated with at least one parent without extra charge, the new rule extends this logic to all passengers on the same PNR to prevent groups from being scattered across the cabin.
LocalCircles surveyed 41,000 consumers in March 2024 and found that 44 percent of respondents reported airlines charging extra fees for every seat, forcing them to pay between 200 and 2,000 rupees for seat allocation, which could represent 5 to 40 percent of the total airfare.
“The Centre’s move to eliminate seat selection fees on 60 percent of seats is a welcome step towards enhancing transparency and passenger fairness in air travel,” said Vandana Singh, Chairperson, Aviation Cargo at the Federation of Aviation Industry in India.
Current industry estimates indicate that merely 20% of seats are offered at no cost, while the remaining options incur extra fees depending on location or features like additional legroom.
Airline Stocks
Domestic airlines are expected to lose out on ancillary revenue derived from seat selection fees. Following the announcement, shares of InterGlobe Aviation and SpiceJet saw immediate market reactions, with both stocks paring early gains to trade lower during the session.
Analysts note that this directive introduces financial pressure on a sector where most major carriers, except IndiGo, are already reporting substantial losses.
“While the exact contours of how airlines redistribute their mandated ‘free seats’ will be seen in the coming few weeks, the order immediately points to a fall in ancillary revenue derived from seat selection fees, particularly if window seats are impacted,” Lokesh Sharma, a senior aviation and defense analyst, told Fe.
He added that typically, domestic airlines operating flights with around 186 seats offer around 12-15 seats for free, usually middle seats in the last five-seven rows, translating to just 8 percent of total seating capacity. The remaining seats are paid options with prices ranging from Rs 468 to Rs 855.
A senior executive from a domestic airline also told Fe that domestic airlines in India see around 15-20 percent of their customers pay for seats when web checking in, and since the government has not mandated which seats are to be offered free of cost, airlines do not anticipate a major impact.
“Passengers usually pay for window seats or seats with extra leg room, like the wing seats, which airlines can still charge a premium for even after the new mandates,” the executive said.
The practice of charging for seat selection began in 2021 after the DGCA allowed airlines to unbundle services like preferential seating and charge separately. The regulator’s 2015 relaxation of earlier rules had permitted airlines to impose additional fees for all seats selected during web check-in.
There is also a concern regarding operational efficiency, as seating PNR groups together may complicate automated seat assignment systems, especially on high-occupancy flights.
In addition to the seat mandates, the DGCA has directed airlines to standardize and publish transparent policies for the carriage of pets, musical instruments, and sports equipment. Airlines are also required to display passenger rights regarding delays and cancellations in regional languages at airports and on digital platforms.
The Ministry of Civil Aviation noted that, as the world’s third-largest domestic aviation market, the priority must remain on “passenger facilitation” and the “uniformity of practices” across all carriers.