Capacity addition takes the wind out of ATF price cut benefit for airlines

Airline executives say low-priced tickets will continue due to massive rise in number of seats

In some relief to cash-strapped Indian airlines, oil companies on Saturday slashed aviation turbine fuel (ATF) prices by almost 11 per cent. 

The cut is steepest in the last two years and will provide some cushion to airlines engaged in a protracted price war have lost control over pricing in one the world's  most price sensitive domestic market.

Airline executives, however, expect no significant improvement in margins as pricing will remain under pressure due to agressive capacity induction.

The price per kilolitre (kl) of jet fuel after the latest cut in Delhi, India's busiest airport, is Rs 68,050.97 in December,