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SpiceJet, AI cut fares, budget carriers may follow suit

SpiceJet, AI cut fares, budget carriers may follow suit

Now, a silent fare war among Indian airlines is appears to be on. SpiceJet’s recent mega sale has triggered a tussle between other Indian airlines who are dropping fares discreetly. Air India dropped fares on January 21 night, taking them lower than rival full-service carrier Jet Airways and matching the prices of the three budget carriers on every route.

IndiGo, SpiceJet and GoAir might drop ticket prices to protect their market shares. Sunny Sodi, COO (Corporate Travel) and Senior VP (Air Product) of yatra.com said that passengers will prefer to fly AI over low-cost carriers to avail of better services like in-flight entertainment, meals and the like. Experts also say that Air India, which has expanded its domestic market-share from a dismal 14 per cent to over 21 per cent last year, doesn’t want to lose its hard-earned lead.

He added that Yatra.com is heading towards a further reduction in ticket prices as budget airlines may slash fares further after AI has matched them. In comparison with December, Yatra may see fare reduction by 15 per cent in the coming days, Sodi added.

However, Air India says that its move is in response to a move by Jet Konnect, which dropped fares on 20 routes to match budget airlines’ levels. On January 11, Kalanithi Maran-owned airline SpiceJet announced 10 lakh seats on offer at Rs 2,013 for travel between February and April, which could be booked over three days. Bookings made between Feb 15-28, 2013.

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