The Telegraph
Thursday , February 21 , 2013
Since 1st March, 1999
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Air India joins low-fare war

New Delhi, Feb. 20: The war over air fares intensified today with Air India jumping into the fray.

A day after Jet Airways offered 20 lakh seats at Rs 2,250 for travel till the year-end and IndiGo, SpiceJet and GoAir followed suit, Air India today launched special fares by offering a discount of up to 40 per cent on one-way regular fare on its domestic flights.

While official sources said the lowest fares had so far not breached the lowest rates given by the airlines to the Directorate General of Civil Aviation (DGCA), civil aviation minister Ajit Singh said, “We are not going to prescribe anything (fares). If we fix a lower bracket and the airlines charge lower than that, the issue will go to the competition council.”

Maintaining that the government would not regulate fares, Singh said a cell was being set up in the ministry to monitor fares, not regulate them. “Whatever needs to be done will be done in consultation with the airlines.”

Air India has priced a one-way ticket from Calcutta to New Delhi on March 1 at Rs 3,174. A similar journey with IndiGo and JetKonnect will cost Rs 3,240 and Rs 4,886, respectively.

On the Calcutta-Mumbai route, Air India’s ticket has been priced at Rs 3,701 against IndiGo’s Rs 3,740 and JetKonnect's Rs 3,849.

On whether the DGCA would warn airlines against indulging in predatory pricing as it had done when SpiceJet had offered 10 lakh seats at Rs 2,013 for a limited period, Singh said the fares would not be regulated but made more transparent.

After the SpiceJet move to slash fares last month, the aviation regulator had urged other airlines not to follow suit as such a practice could be harmful to their bottomline.

Vikram Malhi, country head of travel portal Expedia, said the drop in fares would help airlines to fill up their seats and increase the load factor.

Dreamliner hope

Air India chairman Rohit Nandan today said Boeing was hopeful of getting its Dreamliner aircraft back in service by early April. “They said that these planes should start flying again from early April. They can’t be sure but they are hopeful,” he said.