The grounding of 14 Airbus A320neo aircraft of budget carriers IndiGo and GoAir due to faulty engines is likely to impact air travel during the peak travel season starting April 15, 2018, said analysts, adding that fares were expected to go up by around 10% due to the demand-supply mismatch.
“Fares are now back to normal, but there was spike when the grounding was announced. This is lean season, so the impact was minimal. But if the capacity scarcity remains in the market for a significant period of time, then fares in the peak summer season will go up by 5% to 10%, ” said Sharat Dhall, Chief Operating Officer, B2C, yatra.com
“There will be an impact. If you see the current load factor trend, most airlines are flying with 90% load factor for the past six months. Now that some capacity is out of the system (due to the grounding), all flights are going full. So when additional demand would be generated in the peak season, fares are bound to go up,” he added.
Travel agents have urged the government to keep a hawkish eye on the fares which are expected to go up due to the demand supply mismatch.
Holiday season
“I am for flexible fares but airlines should not jack up fares to abnormal levels . So far the airfares are normal except some occasions, but they may go up by 5% to 10%, starting April 15, 2018 when families will he heading for holidays,” said Subhash Goyal, Chairman Stic Travel Group and Chairman, Travel Committee of Assocham.
“The government must intervene and cap fares. Airlines should be allowed to make reasonable profit but passengers must not be fleeced,” he added.
