Strained over the current scenario, LCCs have discontinued offering tickets as economical as those available a few years ago and hiked the minimum airfare, even in non-peak season. The transformation of tariffs has been unrealistic and beyond cruel over the past two years according to Sudheer Raghavan, Chief Commercial Officer, Jet Airways. “India is one of the most expensive countries in terms of the aviation industry. It is high time that we and the Government realise that aviation is an economy enabler and not something that should be crashing down,” he said.
The differences between LCCs and full service airlines in the country have always been very vague for the end consumer, believes Deepak Brar, Director Commercial, Air India. Explaining the tariff rise, he said, “Due to a healthy demand all year, LCCs have stopped releasing ‘lower bucket fares’ except for at the last moment, when seats are going empty,” he said.
Bill Frankie, Managing Partner, Indigo Partners, believes that the LCC model was always on shaky ground in India and will remain so unless committed efforts are made to build facilities for no-frills operations. Kapil Kaul, CEO, Centre for Asia Pacific Aviation (Subcontinent and Middle East), stated that the Indian aviation Industry is open in air and closed on ground and doesn’t think anything will change in the forthcoming years. The new tariffs, he added, may drive away some passengers, but it is the only way an airline can make profits.
Aditya Ghosh, President, Indigo stated that the higher fares may have caused a drop in passenger figures but everything isn’t negative as it seems, “When the LCC trend started, many middle-class Indians took to flying. It is truly amazing to see how in just 80 months passenger figures have increased from 13 million to 65 million per year on an average. But there is no denying the fact that the cost of operation is already very high, given the steep airport fee like at Delhi airport. Also, fuel costs add to the burden. When these factors come together, ultimate cost is excruciating.”
