BackFlight ticket prices skyrocket as airlines reduce capacity
Grounding of several Jet Airways aircraft and Mumbai airport's runway closure reasons for severe capacity reductionAirfares are expected to remain high till at least March-end, when the Mumbai airport will be fully operational
PremiumMumbai: If you are planning on booking a last-minute flight ticket, be ready to pay through your nose. Airfares on trunk routes, connecting major metro cities, have risen 30-50% year-on-year, following the severe capacity reduction due to the grounding of more than two-fifths of Jet Airways (India) Ltd’s fleet, and a runway closure in Mumbai.
For instance, Delhi-Mumbai flight ticket price rose 48% on an annual basis to ₹5,849 in March, according to travel and hotel booking website Ixigo.
Ixigo data shows in March, the average one-way airfares between New Delhi and Pune rose 44% to ₹5,973, while those between New Delhi and Kolkata increased 42% to ₹5,678. The average fares between Mumbai and Hyderabad rose 35% to ₹3,228 and between New Delhi and Chennai it saw 34% increase to ₹5,382.
For those booking last-minute flight tickets, airfares have soared even higher.
According to data from online travel portal Yatra Online Pvt. Ltd, the average last-minute airfares—bookings made a day before or same day before travel—between Mumbai and Delhi currently stands at ₹12,502, while the that of Mumbai-Kolkata is about ₹29,040, and between Mumbai and Chennai is ₹19,541. Similarly, the last-minute average fares between Delhi and Kolkata stands at Rs10,375, according to Yatra.
“There is a constraint on capacity due to grounding of Jet Airways’ aircraft, the closure of the Mumbai airport due to ongoing runway maintenance work (every alternate day till 30 March), and reduction in capacity at IndiGo due to pilot issues," said Sharat Dhall, chief operating officer (B2C), Yatra Online.
“Since the load factor has been high as this is a busy season for travelers, the demand has been ahead of the supply, which has resulted in sharp increases in airfare," Dhall said. “In some cases, it (airfare) is absurdly high, but even on other routes, it is 20-30% higher than what normal last-minute fares were. Overall as well, there has been an 18% increase in average fares across sectors as compared to last year."
Airlines operating in India have reported losses in the past few quarters on rising fuel prices, falling rupee and their inability to pass on costs to customers due to intense competition. However, in recent months, airlines have been passing on rising costs to passengers. With a massive capacity reduction, passengers, especially those flying between busy trunk routes, have little option but to purchase high-priced tickets.
Jet Airways, which is facing financial uncertainty and has not been able to pay its lessors, has grounded 47 of the 119 aircraft, according to its website.
Similarly, the country’s largest domestic airline, IndiGo (InterGlobe Aviation Ltd), had last month cancelled several flights due to an acute pilot shortage but has since stabilized its operations. “It seems airlines are continuing to target high load factors. And, with lower capacity in the market, airlines are not ready to lose out on margins, especially in key sectors," said Himanshu Periwal, vice-president, growth, Ixigo.com.
Periwal said the current high airfare regime will continue at least till March-end, when the Mumbai airport will be fully operational. “The high airfares could ease in April if the situation at Jet Airways gets better and they are able to fly their grounded aircraft," he added.
Jet Airways’s precarious financial situation has further added to its woes, with many corporate customers having switched to IndiGo, said a Mumbai-based travel agent whose clients include a prominent law firm and a software major.
“With Jet operating only a portion of its fleet, there is an uncertainty surrounding its future. This has shifted a lot of former Jet passengers to other airlines like IndiGo, which has in a way only added to the demand," he added.
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