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Saturday, September 14, 2013

Air fares skyrocket 55% in two weeks, biggest rise in 3 yrs

Mumbai: The past two weeks have witnessed the steepest air fare hike—55% on an average. This is the first time in three years that air fares have scaled so high in such a short span of time. 

    The hike is so brutal that even the diligent early birds who book their tickets months in advance have not been spared. So, to board a flight around November-end, a passenger booking an air ticket now would need to pay approximately 55% more than the passenger who was prudent enough to book the same ticket in the last week of August. 
    Data released on Saturday by an online travel portal compared advance purchase fares as they shot up over the past two weeks across six advance purchase categories, starting with tickets purchased a week in advance from the date of travel to those booked three months in advance. 
    The data covered average one-way fares on 20 domestic routes including Mumbai-Delhi, Bangalore-Hyderabad, Mumbai-Kolkata, Mumbai-Bangalore and so on. The highest hike—which was 64%—was observed in the seven to 13 days advance purchase category (see box). Others were equally high. For instance: If one had 
booked a ticket zero to 
six days in advance on, 

say, the Mumbai-Delhi route on August 25, one would have paid Rs 4,900. The same advance purchase fare is now priced around Rs 7,600. 
    As on September 11, a zero to six days' advance purchase fare was priced at an average of Rs 7,900 while for seven to 13 days' advance purchase it was Rs 6,800. For a ticket on a flight three months from now, the fare is Rs 4,200. The data shows that fares have been consistently on the rise since August. 
    Keyur Joshi, co-founder and chief commercial officer of makemytrip.com, said, "This is the steepest air fare hike witnessed in the past three to four years. While customers have faced exponential air fare hikes in the past, the increases are typically spread out over several weeks. This time around, though, the hike has occurred in a matter of a few days." Joshi further said while the fares needed to be rationalized to sustain the airline business, the current fare increase is too steep, especially in the longer advance purchase category. 
    "The 30-day advance fares should have been left untouched—this would have helped manage traveller concerns and avoided sudden drop in bookings. While air tickets need to be rationally priced to ensure sustainability in the long run, it is equally important that flights have a 
    healthy load factor."



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