Thursday, September 5, 2013

Spice Jet, now Air India Hike Air Fares By 25%

Air India on Thursday hiked passenger fares by 23 to 25 per cent on all domestic routes, following a sharp increase in the price of aviation turbine fuel (ATF). The carrier may also raise fares on international routes.

"We have hiked fares by 23-25 per cent

on all domestic routes. This has been done to offset the recent increase in ATF price," an Air India official told IANS.

The hike comes a day after Jet Airways and SpiceJet announced similar hikes in their airfares.

Carriers have been forced to raise tariff to mitigate the impact of the sharp fall in the rupee value and a near 15 per cent spike in oil prices of late.

Jet fuel prices were hiked by a steep 6.9 per cent, taking the rate to Rs. 75,031 per kilolitre (KL) from September 1. This hike had come on the back of two rounds of ATF price hikes effected in July and August by oil marketing companies.

ATF prices were increased by 5.8 per cent on July 1 and by another 6.3 per cent on August 1.

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Wednesday, September 4, 2013

Air Fares Expected To Be Raised By 10-15% Following Jet Fuel Price Hike

Air fares are likely to increase by 10-15% from current levels in the immediate future following a steep hike in jet fuel prices, according to travel industry players.

"Fare hike is imminent. The only question is who takes the lead. I would expect a 10-15% increase in fares in the coming days," said Travel Agents Federation of India (TAFI) immediate past president Ajay Prakash on Wednesday.

Prakash, who is the chief executive of Nomad Travels, said fares have already seen some traction in the last two days and "the trend is likely to continue."

Jet fuel (ATF) prices were hiked by a steep 6.9%, taking the rate to Rs. 75,031 per kilolitre (KL) from September 1. This comes on the back of two rounds of ATF price hike effected in July and August.

ATF prices were increased by 5.8% on July 1 and by another 6.3% on August 1.

"With the steep hike in air turbine fuel prices, the airlines are left with no option but to jack up the fuel surcharge to offset the increase," Travel Agents Association of India President Iqbal Mulla said.

Expecting an increase of up to 10% in domestic fares, Mulla said the sharp decline in rupee value against US dollar and high jet fuel prices will have multiple effects on ticket rates.

Airlines Air India, Jet Airways, SpiceJet and IndiGo did not respondent to queries on the issue.

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