Mumbai: Boeing India president Dinesh A Keskar on Sunday called for the urgent need to reprice airfares saying the industry is losing a whopping Rs 900 per ticket currently.
“Pricing cannot go on the way it is now. Domestic airlines lose Rs900 a ticket on an average today. With fuel prices going the way they do, it is high time that the airlines end the current practice of predatory pricing. They need to hike fares by a reasonable amount in order to sustain,” Keskar told PTI on the sidelines of the 27th edition of the India Chapter of the World Economic Forum here on Sunday.
The 3-day summit is being organised jointly by the WEF and the premier industry body CII for the first time in the nation’s financial capital and was kicked off on Saturday evening.
Dinesh Keskar, president, Boeing India. Bloomberg.
Pointing out that when crude was trading at $75-80 a barrel, airlines were making only negligible profits, Keskar said. And now with crude at over $110 a barrel, one can imagine the loses the airlines are making.
Pegging the annual loss of the domestic carriers at around $1 billion in 2011, the Boeing official said, despite all these travails, he is optimistic that the industry offers tremendous growth opportunities going by sheer size of this market and the monthly traffic growth.
When asked about the Dreamliners delivery to the ailing Air India, he said, “we are ready to deliver the planes from next month, but the airline has some issues, which it has to sort out. But I respect that process.”
On whether he is confident that the original deal for 27 aircraft will be met, he answered in the affirmative. But he was quick to add that it is the government that has to decide. I am of the firm opinion that this is an airplane which the national carrier needs badly as it can help revive its fortunes by better alignment of its operations.”
On the Boeing order book from India, Keskar said, the company will be delivering 100 aircraft on schedule. We are happy with our growth in this market and am sure the current turbulence in the market will be overcome.
On whether Boeing sees any fallout of the crisis involving Kingfisher and Air India on the industry, he evaded a direct reply saying we don’t deal with KF. But pointed out that AI will soon improve its performances.
On the $100-million Boeing-MRO in Nagpur, he said, the facility will be up and running by the fourth quarter of 2012.
“Its on course and will be ready by Q4 of 2012,” he said.