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A-I, foreign airlines may cut fares by 10%

Rumi Dutta in Mumbai

With the lean season in international air travel round the corner, foreign carriers are looking at offering substantial discounts to lure passengers.

Air-India and major international airlines are designing fare structures aimed at reductions of up to 10 per cent. The new fares are expected to take effect from October 1.

Passengers flying to New York, London, Dubai and Singapore in October are expected to be the major beneficiaries.

An A-I spokesperson told Business Standard: "The demand usually arises after September 15, which marks the end of the peak season. We will adjust the fares for certain international sectors, depending on the load factor after mid-September. Based on the demand, fares will be adjusted to the extent of 5 per cent."

Industry sources predicted other airlines would follow suit. However, most carriers declined to reveal the extent of discounts to be offered.

Hans Peter Doser, general manager (India), Swiss International Airlines, said: "We are not the market leaders in the India sector, and hence, we are not the price makers. However, a fare cut may only lead to a fight for market share without contributing towards traffic."

A-I took its first step towards lower fares when it offered a 25 per cent discount to senior citizens visiting their children and relatives in the UK and the US, with effect from September 1.

A-I's Mumbai-New York-Mumbai and Mumbai-London-Mumbai four-month return excursion fares on economy class are Rs 47,000 and 32,200 (excluding taxes), respectively.

Up to September 15, students flying abroad contribute heavily to the load factor. From December onwards, airlines start reporting healthy load factors, with passengers from the West pouring into India.

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