The decision of all private airlines to suddenly hike fares doesn’t make any sense at all. First, these airlines all got bailouts from the government. Second, surely they would want all of us to fly more?
The recent hike will translate into more profit per ticket, but what if the number of tickets sold do not increase?
In any case, the airlines’ strategy of lowering fares, to even as low as one rupee for a very minuscule amount of travellers, had begun to work. Recent reports all suggested that the load factors of airlines had started improving. Presumably this meant the airlines had got minimum load factors for the coming months already — to avail of the low fares, passengers have to book their flights several weeks in advance.
So, if the airlines had got minimum load factors, what prompted them to go and hike fares? Especially at a time when the economy is slowing down and the job prospects of the flying classes look increasingly shaky. It appears someone in the airline industry has goofed up in a very big way.
It would not be surprising if, after all the hikes, the aviation industry is once again forced to come back to the government for another bailout in another six months or so. At that point, the government must call their bluff. If the business is unviable at the current tariff levels, then airlines must be told to wind up.
Arunima Mishra, New Delhi
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