The Hindu Business Line : Airfare hike under wraps

"There may not be a clear-cut fare hike. Airlines could, however, look at adjusting fares as the industry moves into the high season," is the common refrain from almost all carriers.

The proposed revisions, the implementation date of which is likely vary from mid-night tonight to the end of the month, could see adjustments being made in about a dozen of more than 50 routes operated by a full-service airline and just one or two sectors of a recently launched low-cost airline.

This time around, the airlines will have to closely look at sectors that currently fall below a pricing formula that was broadly agreed to recently.

The formula, proposed at a meeting in Mumbai, was that the low-cost airlines should not charge less than Rs 2 per km while full-service airlines would not charge less than Rs 2.40.

This effectively would mean that a ticket on a low-cost airline flying between Delhi and Mumbai should not be priced less than Rs 2,000, not including taxes, although tickets are currently available for as low as Rs 1,499.

What complicates matters further is that not all airlines are willing to follow the formula. "We are not opposed to a reasonable fare revision but if it is unjustifiable, we cannot implement it," said a senior official of a low-cost airline.

Similarly, full-service airlines have expressed fears about the impact of following the formula on long-haul flights. "If the fare differential on Delhi-Bangalore-Kochi sector is Rs 800 or more, who would want to fly with us," asked a full-service airline official.