Airlines to monitor passenger response during weak months of July-September
Airlines to monitor passenger response during weak months of July-September
According to data from online portals, domestic and international airfares have seen an increase of up to 50% in the past few months, with the increase in fuel prices.
A ticket booked from New Delhi to Mumbai on Saturday for a flight within the next 15 days will cost the customer ₹8,576 as compared to ₹5,675 in January this year – an increase of 51%. Similarly, a flight ticket from Bangalore to New Delhi within the same booking window will cost ₹9,674, which is 38% higher than ₹6,984 five months ago. And, Mumbai to Varanasi air ticket increased by 47% to ₹8,565 as against ₹5,810 in January.
Data from travel portal Xigo shows that airfares on various domestic routes were higher by 27% to 50% in the month of May as well.
Manan Bajoria, VP, Growth Marketing & Analytics, Ixigo, says, “Right now we have seen the highest post-COVID rentals domestically.”
Nevertheless, in May the airlines flew the highest number of passengers since the pandemic at 1.20 crore passengers.
International flights returning to their pre-COVID-19 levels from March 27 are also costlier than in 2019. The Mumbai-New York one-way fare was ₹70,296 in May 2022, a 53% increase from ₹33,265 in May 2019. , and an air ticket of ₹51,223 for a flight from Bangalore to London was 18% expensive and Mumbai to London 52% expensive.
“However, despite rising airfares, interest in international travel remains strong this summer, as demand picks up with international travel fully resuming after 2 years. Southeast Asia, the Middle East and Europe are the top summer destinations this year. Search queries for UAE, US, UK and Canada are seeing a week-on-week increase,” says Mr. Bajoria.
Recently, SpiceJet chairman and managing director Ajay Singh said that airlines were left with no option but to raise fares immediately, and a minimum hike of 10-15% was required to ensure sustainable cost of operations. He attributed this to a 120 per cent hike in ATF prices since June 2021 as well as a weaker rupee as a significant portion of the airline’s cost is dollar denominated. He said fuel now accounts for more than 50% of the airline’s operating cost, up from the earlier levels of 30%-40%.
Vistara CEO Vinod Kannan has also said that Airfares hike was ‘inevitable’, IndiGo has also called for the need to increase the upper limit of the fare band imposed by the government for bookings 15 days prior to departure.
The rising cost of ATF has forced airlines around the world to increase airfares, and the International Air Transport Association (IATA) in its latest global outlook said such a move could cause passengers to travel more than ever due to the huge demand for travel. Can’t be stopped. Personal savings accumulated during the pandemic, along with a two-year gap, but price insensitivity may fade in 2023 as consumers fill their travel losses.
While so far increased airfares supported a strong demand for travel, the airline’s CEO will see how passengers respond to the hike as the summer vacation draws to a close and the industry enters a lean travel season from July to September. give.
“We have to cross our fingers, wish, pray and see what happens,” the Vistara CEO recently told reporters. Big players in the market such as Indigo, which has a large number of planes to fill, will determine which way other players go.
“We are 9% of the market share. 91% of the market is renting and pricing to a certain extent. Where I bring some value to the table and I can justify that value, that is international and fixed [other] way, we’ll try and do that [raise fares], But on other avenues we have to see how the market behaves.