Mad rush to match GoAir's Rs 599 offer

GoAir's offer of the lowest round-trip fare of Rs 599 through a tie-up with travel portal Cleartrip is most likely to start a fare war among airlines during the lean season.

QUEUEING UP

SpiceJet and Simplifly Deccan are all set to give away throwaway offers, while GoAir is looking for similar tie ups with portals

Air travellers can expect around 25,000 such cheap fares tickets on offer upto April 15, say experts

IndiGo on Wednesday announced a four-day offer, which gave customers Rs 200 off on all tickets booked.

With SpiceJet and Simplifly Deccan all set to give away similar throw-away offers and GoAir looking for similar tie-ups with travel portals, air travellers can expect around 25,000 such cheap-fare tickets on offer up to April 15.

February to mid-April is generally a lean season for airlines.

Recently, GoAir announced that it was tying up with Cleartrip to announce a return fare of Rs 599 across all sectors in India. This offer is around 65 per cent lesser than the cheapest return trip of around Rs 1,000 available currently.

After the announcement of this offer, the number of hits on Cleartrip for GoAir tickets has increased by 500 per cent.

IndiGo on Wednesday announced a four-day offer, which gave customers Rs 200 off on all tickets booked. The offer is valid from February 20 to 24.

Said Bruce Ashby, CEO, IndiGo, "It is more than likely that many carriers are going to give offers similar to GoAir for the time being. We are closely looking at GoAir's offer and its outcome."

Delhi-based carrier SpiceJet has already approached travel portals such as Makemytrip for similar offers though they may not be as cheap.

"This fare is much lower than the lowest fares offered in the industry now. And though the number of seats offered are really small, it will definitely impact other airlines, including us," said Kamal Hingorani, V-P, marketing, SpiceJet.

"Apart from SpiceJet, which has approached us, we have also been approached by GoAir, which will come into place when bookings for the current offer of Rs 599 ends on March 5," said Mohit Srivastava, head of online sales for Makemytrip.

According to Srivastava, these fares, though not as cheap as GoAir's, will definitely come below the industry average of Rs 1,000 (base fare including to and fro), and will be sold across all sectors.

"All the airlines have realised that sector-specific cheap offers have a much lesser impact than a countrywide offer. What passengers are ultimately looking for is one airline that can offer cheap fares on all destinations so that they do not have to look at too many options," said Srivastava.

Not to be left behind, Simplifly Deccan is also in talks with Yatra.com to offer return fares at throw-away prices for some select sectors.

"The airlines are doing it because of the lean season. This season, even though average load factors are higher those last season (70 per cent compared with 65 per cent last year), the available seats more than outnumber the passengers' demand for travel," said an industry expert.

Though full-service carriers have not really caught on as yet, Jet Airways has been playing around with its fares for garnering better loads.

"Though Jet has not announced any significant offer apart from the Rs 500 weekend base fare a short while ago, it has been offering cheaper fares on advanced bookings. For example, if you book a Jet Airways' ticket on the Mumbai-Delhi route 45 days in advance, chances are that you might get it at a base fare of Rs 1,525, while the average floor price is Rs 2,100 . However, full-service carriers might not give away return fares as cheap as Rs 500-600, unlike LCCs," said an industry insider.

However, crude oil prices, which touched an all-time high of $100.10 a barrel on Wednesday, might act as a dampener.