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Fare effect: airlines register a 12.6% fall in passenger traffic

Fare effect: airlines register a 12.6% fall in passenger traffic
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First Published: Wed, Aug 13 2008. 01 38 AM IST
Updated: Wed, Aug 13 2008. 01 38 AM IST
New Delhi/Mumbai: The number of people travelling by air has fallen to 3.04 million in July, down 12.65% from a year ago, the civil aviation ministry has said.
It is the sharpest fall in air passengers in the four years since India’s aviation boom started in the summer of 2004. In June this year, air passenger demand, measured by passengers flown, had shrunk 3.8% from June 2007.
Airlines, fighting to contain the effects of record jet fuel prices, have raised air fares at least six times this year. The increased fares have resulted in fewer people flying. July to September is also typically a lean season for air travel.
Despite airlines cutting down heavily on the number of flights—2,144 flights a week were pulled back from route maps of domestic carriers in July from nearly 11,000 weekly flights earlier—carriers are still reporting lower occupancy rates.
Airlines carried 3.05 million passengers in July compared with 3.49 million in the same month of 2007. “The decline is largely a result of higher fares and essentially reflective of the higher fuel prices,” said Samyukth Sridharan, chief commercial officer of low-fare carrier SpiceJet Ltd.
Deccan Aviation Ltd-run Simplifly Deccan, which is merging with Kingfisher Airlines Ltd, saw its sharpest dip in load factors—a measure of how full a flight is—at 49% in July compared with the same month in 2007 when it flew its planes 67.7% full.
Other low-fare carriers SpiceJet, InterGlobe Aviation Pvt. Ltd-run IndiGo and JetLite India Ltd, too, saw their flight occupancy drop to 57.8%, 59% and 60.4%, respectively, compared with 71.4%, 71.5% and 68%, respectively, last year.
Kingfisher flew its planes 63% full compared with 66.7% last year. Rivals Jet Airways, National Aviation Co. of India Ltd’s Air India and Paramount Airways India Pvt. Ltd reported 67.9%, 55.5% and 76.1% occupancy on their flights in July compared with 67%, 69.1% and 53.1%, respectively, in July 2007.
M. Thiagarajan, managing director of Paramount Airways, said the slowdown would be worrisome if it continues into the three months starting October. “Then it is a major problem. But I don’t think it would be that low in the peak tourist season.”
Airlines in India expect to post a combined loss of about $2 billion (Rs8,540 crore) this fiscal year to March 2009.
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First Published: Wed, Aug 13 2008. 01 38 AM IST
More Topics: Airlines | Fare hike | Crude oil | Aviation | SpiceJet |