Dubai’s Emirates airline has cut ticket prices by 25-30% on international routes through an advance purchase ticket scheme.
According to a copy of the circular reviewed by Mint, the airline has introduced the discount on advance purchases—3, 7 and 10 days in advance—on flights to Dubai from cities including Thiruvananthapuram, Kochi, Delhi, Mumbai, Chennai, Hyderabad and Kozikode till 31 March.
Emirates, which operates 185 flights a week to 10 Indian cities, made the discount effective Wednesday.
The move has triggered a price war. On Thursday, Anand Yedery, area sales manager (western India) at Cathay Pacific, said his airline has begun offering a nearly 10% discount to Hong Kong flights from India.
“This is SpiceJet type of tactics,” said Ajay Prakash, immediate past president and Travel Agents’ Federation of India and promoter of Nomad Travels. It was on 11 January that Chennai-based low-fare carrier SpiceJet begun offering one million seats at an all-inclusive fare of Rs.2,013 for any local flight between 1 February and 30 April, booked till 13 January.
“SpiceJet sold cheap tickets to stimulate the market and fill in passengers during the lean season. They have now priced their tickets on expensive side after selling a reasonable number of tickets to push up loads. International airlines are also doing the same to push up sales during lean season,” Prakash said.
Travel agents say the Emirates scheme will prompt other airlines such as Qatar Airways, Singapore Airlines, Silk Air and Etihad Airways to follow suit by offering discounts of up to 15-30% on tickets to push up seat occupancy during the lean season which starts from mid-January and end in April.
SpiceJet had sold 170,000 tickets booked on the day the discounted tickets were announced (18 January) till 5pm while the airline typically books 40,000 seats on a normal day. Other Indian low-fare airlines reacted to the move by matching the fare cuts, but most of them rolled back the schemes by evening.
“Airlines introduce these tactical fares for the summer schedule to cater to early bookers and this is excellent for customers who have plans chalked out and they can avail of these excellent offers. However, these are for limited inventory but it’s great for customers. Airfares can be cheaper by at least 15% if booked early,” said John Nair, vice-president, business travel at travel house Cox and Kings Ltd.
Singapore Airlines and its low-fare subsidiary airline, Silk Air, make flying cheaper by allowing their fliers to display boarding passes of these airlines at Changi airport information counter, and avail of Rs.1,800 worth vouchers to shop, dine and access the transit lounge of the airline.
Qatar Airways offers special discounts to Indian students apart from normal concessions. Etihad Airways offers discounts routinely.
Deepak Singh Rahandale, co-founder of online travel agency firm Madfares.com, said airlines plan to cut fares to safeguard their market share as a first step.
“Secondly, dropping price is a concept to get attention of the fancy FIT (free individual traveller) and to make them upgraded to group holidays,” Rahandale said.
A senior executive with an international airline, requesting anonymity, said an airline like Emirates never used to come up with these “stimulating” fares. “Many more airlines will be forced to follow these stimulating SpiceJet-like fares for two reasons—lean season and competition. But it’s good for passengers.”