Airline firms seek to raise fares as aviation fuel price increase again in March: Report

According to a Moneycontrol report, ATF prices have surged 26.4 percent, or Rs 19,508.25 per kilo-litre (kl), since December 15 in New Delhi. The latest increase of 3.22 percent on March 1 took ATF to Rs 93,530.66 per kl in New Delhi.

Airlines are likely to increase airfares on popular tier-I routes by 15-20 percent by mid-March and by 20-25 percent on regional routes by the end of this month, said the report citing industry experts.

A senior airline official told Moneycontrol report that the current Mumbai to Delhi airfare is expected to grow from nearly Rs 2,300-13,000 to around Rs 2,900-15,000 by March said.

“Price hikes are inevitable – there is no way to refrain from price hikes if crude keeps rising due to the ongoing conflict in Europe,” an airline executive was quoted as saying by Moneycontrol.

The government had set up the upper and lower airfare limits under the Aircraft Act, 1934 to protect the interests of travellers in the wake of pandemic.

Last year, the airfares were hiked four times by the government in 2021.

ATF accounts for 30-35 percent of operational costs and the rise in the price of the fuel is making diificult for the companies to maintain operating efficiencies.

Airlines companies are also hoping that the government will include ATF in the goods and services tax regime to reduce their burden.