Hit by mounting losses and high debts, private airlines have asked the government to allow them to raise fares. Representatives of private airlines have met senior government officials in the finance and civil aviation ministries in the last few days to present details about the precarious state of their balance sheets, a government source said on the condition of anonymity.
Private airlines also sought a level-playing field arguing how state-owned Air India enjoys many advantages as it can dig into the government's coffers to fund its way out of a crisis, an option not available to its peers, according to a report by Saubhadra Chatterji in Hindustan Times.
The fare monitoring cell of the Directorate General of Civil Aviation is currently analysing the spike in air fares during the festive season after most airlines reported an average 10 per cent hike. Airlines maintained that high passenger traffic have filled up the low-fare buckets, leaving only costlier options available for later bookings.
"It is estimated that Indian carriers lost Rs 3,525 crore by selling seats at levels 15 per cent below cost," read an informal note presented by private airlines to the finance ministry. “During the first half of the current fiscal year (April-September 2011), domestic airlines incurred a loss of Rs 2,900 crore, If this trend continues, the full-year loss will be well over Rs 4,700 crore for the industry." the note read.
Source : Travel Biz Monitor
Private airlines also sought a level-playing field arguing how state-owned Air India enjoys many advantages as it can dig into the government's coffers to fund its way out of a crisis, an option not available to its peers, according to a report by Saubhadra Chatterji in Hindustan Times.
The fare monitoring cell of the Directorate General of Civil Aviation is currently analysing the spike in air fares during the festive season after most airlines reported an average 10 per cent hike. Airlines maintained that high passenger traffic have filled up the low-fare buckets, leaving only costlier options available for later bookings.
"It is estimated that Indian carriers lost Rs 3,525 crore by selling seats at levels 15 per cent below cost," read an informal note presented by private airlines to the finance ministry. “During the first half of the current fiscal year (April-September 2011), domestic airlines incurred a loss of Rs 2,900 crore, If this trend continues, the full-year loss will be well over Rs 4,700 crore for the industry." the note read.
Source : Travel Biz Monitor
