West-bound airlines end 25% group discount

Move prompted by shortage of seats in flights to the US and Europe.

Most West-bound international airlines have discontinued the 25 per cent discount scheme offered to travel agents for group bookings.

This will spark off another round of increases in Europe and US tour package prices, over and above the recent increase following heavy demand for these package tours.

Balbir Mayal, president of the Travel Agents' Association of India (TAAI), the apex body of travel agents in the country, said: "We are facing a peculiar situation this year. We are flush with business but are not in a position to encash this fully. Leave aside group booking discounts, we are not even getting seats. Most of the West-bound airlines have discontinued bulk booking discounts."

"There is shortage of over 1 million seats on the Europe and US sectors this summer," said a senior executive at a leading international carrier. This is despite Air-India having doubled its capacity and other airlines having increased the frequency of flights on these sectors.

Tour operators usually sign group booking agreements with the airlines months in advance. However, this year the travel industry had under-estimated the growth in peak season demand and had not made adequate arrangements in advance. With airlines operating at optimum capacity, the chance of discounted offers being available are virtually non-existent.

Industry sources said fares might go up further. With the demand-supply dynamics in their favour, most carriers usually jack up fares during the peak season. International airlines, led by Air-India, implemented a 5 per cent increase in fares from April 1.