The Hindu Business Line : Summer travellers feel the heat as air fares rise

Mumbai May 12 The rising air fares seem to be dampening the spirits of Indian leisure travellers this summer. While the average load factors on domestic routes are down by around three percentage points that on international destinations have taken a two percentage-point hit.

Globally, the load factors are at 68 per cent, down from 70 per cent last year. In India, the numbers stand at 72 per cent, down from 75 per cent last year.

Average ticket price this summer ranges from Rs 4,000 to Rs 7,000 (including taxes and surcharges) between Mumbai and key southern cities such as Chennai, Hyderabad or Bangalore, an increase of Rs 1,500 to Rs 2,000 from last year. Travel industry experts say fuel surcharge is the main reason for the increase.

New loyalties

According to Mr C.V. Prasad, President of Travel Agents Association of India, on the domestic side, especially on short haul destinations, fares have touched threshold levels. “People’s loyalty is shifting towards railways and buses on these routes!” he told Business Line.

Interestingly, this is for the first time that the industry experts are saying that people are going back to railways and roadways as preferred modes for travel after Air Deccan began the era of low-cost air travel in India in 2003.

The airlines too are going through tough times. “The rising air fares are turning out to be a double whammy for airlines because the fuel prices are at a record high and as they increase the fuel surcharge correspondingly, the tickets become unaffordable for average middle class people, who had taken to air travel in a big way.”

International route

On international routes, especially Singapore, Malaysia and other South East Asian countries, demand for leisure travel did not pick up this summer due to rising inflation.

Mr Siddhantha Sharma, Executive Chairman of Spicejet, one of India’s low cost carriers, said that there has been a correction of around five to seven per cent in load factors of low cost carriers with an increase of 20 per cent in the average ticket price compared to 2007.

However, Air India’s spokesperson said that there has been no visible change in load factors as yet. Fuel prices are spiralling and there might be some impact felt later this year, he said.