Slowdown, more capacity keep air fares low

New Delhi: The cooling economy has its impact on domestic air travel too with average air fares on most routes rising just 10-15 per cent in the festive season starting October.

This is against the airlines' expectations of 20-25 per cent in the peak winter season. In what suggests low demand, ticket for a one-way trip to Mumbai from Delhi could be booked for Rs 2,990 for travel on October 8.

"Compared to September, average ticket price on domestic routes have gone up just 10 per cent so far. In the next few days, we expect it to firm up. It should go at least 20-25 per cent," a senior executive of a low-cost airline said.

Online travel firm MakeMyTrip said that there has been a trickle-down effect of slowdown on the domestic air fares and as a result tickets are currently priced 15 per cent higher than last year, for the winter season. As regards advance purchase booking patterns, the leading travel firm said that air fares for domestic routes, booked within a week of travel, have reduced by 10 per cent this year.

"On the domestic front, air fares have increased by 10 per cent when compared to last year. Amongst popular routes, Delhi to Bangalore has seen a 70 per cent year-on-year increase in air fares," a MakeMyTrip spokesperson said. Aviation experts pointed out that excess capacity and slowdown are the major reasons of lower air fares.

"Fares have not gone up much. It has increased just 5-6 per cent despite the fact that Jet Airways shut down. Travel demand is there largely because fare is low," said Ankur Bhatia, executive director, Bird Group.

Interestingly, travel business executives said that fare level on international routes is better compared to local routes as a result of lower available capacity following Jet Airways shutdown. The travel demand for short-haul destinations such as Dubai, Bangkok, Ho Chi Minh City and Phuket has been robust.