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Mixed airfare trends after removing the limit; Air passenger traffic is increasing: Report

Mixed airfare trends after removing the limit;  Passenger traffic is increasing: Report

This move also comes in the context of domestic air passenger traffic gradually recovering.

Mumbai / New Delhi:

According to tourism industry experts, after the lifting of the airfare limit, there seems to be a mixed trend of falling fares for routes with relatively less passenger load.

More than two years after it was introduced amid the coronavirus pandemic, the fare cap was removed effective August 31. The move also comes amid growing domestic air passenger traffic. gradually recovered.

Average booking prices have not changed much but appear to be trending in the opposite direction with certain industries dropping fares while others seeing increases, according to industry players.

The country’s largest airline, IndiGo, said the removal of the fare cap will provide an opportunity to offer dynamic rates and passenger numbers have steadily increased over the past five to six months.

The airline gave a specific answer on the lifting of the airfare limit.

Indiver Rastogi, President & Team Leader, Global Business Travel, Thomas Cook (India) and SOTC Travel, said that removing airfare caps allows carriers to offer the benefit of lower pricing to guests passengers on sectors / routes where the flight load is relatively lower than other airlines.

“And this has already been seen for legs like Amritsar, Lucknow, Dehradun, Surat, Nagpur and Pune, where fares are 8-10% lower than the previous limit removal.

“Airfares from September 1 to 15, 2022, to high-load/popular destinations from various hubs like Mumbai, Pune, Delhi, Bengaluru are understandably higher than the average. remove the previous limit; increase 20-25% for Andaman, 15-20% for Goa, 5% for Kerala and Himachal, 10-15% for Kashmir,” Rastogi said.

Karthick Prabu, Head of Strategy at Cleartrip, says it’s too early to go mainstream given the removal of airfare caps.

A comparison of the first 15 days of August and September shows that September saw 23% higher bookings than August, he noted.

“The number of segments booked by customers also increased by 21%. Interestingly, the average booking price has not changed much. However, there are price segments that have decreased and fares are also expensive. Airfares are also expensive. before October decrease. Tourism has been observed. Fares for festival times, especially Dussehra, Diwali, etc. are continuing to be high,” he said.

On August 10, Civil Aviation Minister Jyotiraditya Scindia said the decision to remove the airfare limit was made after a thorough analysis of daily demand and prices of aviation turbine fuels (ATF). ). The limit has been removed effective August 31.

According to Rastogi, the elimination of fares created affordability for high-season travel in December, with increases of only 20-40% for leisure routes.

Still, business routes are still up 18-30% despite capacity constraints and rising ATF prices, he said.

An IndiGo spokesperson said it has seen a steady increase in tourist numbers over the past 5-6 months.

“We’ve seen a sharp increase in passengers preferring to fly domestically. The removal of the air fare cap will provide the opportunity to offer dynamic pricing for our passengers. As an airline As a leading airline, we are able to offer the best fare structure to our customers,” the spokesperson added.

In August, domestic airlines transported 1.01 thousand passengers, up more than 4% compared to 97.05 thousand passengers in July.

“Passengers carried by domestic airlines between January and August 2022 were 770.70 lakh compared to 460.45 lakh in the corresponding period of the previous year, thereby recording growth. annual growth rate of 67.38% and monthly growth of 50.96%,” aviation regulator DGCA said on Friday.

Jyoti Mayal, President of the Association of Travel Agents of India (TAAI), said the decision to remove the fare cap was made at the opportune time as the festive season is about to begin, which will bring days good for visitors.

“Airfares increased due to ATF which has increased significantly since the beginning of the year. However, with the price reduction, fares are now under control and further reduced due to stiff competition among flight operators” , she added.

TAAI has more than 2,500 members.

(Except for the title, this story has not been edited by NDTV staff and is published from an aggregated feed.)

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