Foreign trips to get costlier by at least 10% on Jet Airways crisis

The closure of Pakistan airspace is another factor as it has pushed up operating costs for airlines

Aneesh Phadnis  |  Mumbai 

The closure of Pakistan airspace is another factor as it has pushed up operating costs for airlines
Air ticket price accounts for nearly half of the total cost for short-haul destinations like Dubai, Bangkok or Singapore

Overseas tour costs are expected to increase by at least 10 per cent more, thanks to the grounding of Jet Airways.

For passengers, air ticket price accounts for nearly half of the total cost for short-haul destinations like Dubai, Bangkok or Singapore while it accounts for around 35-40 per cent for Europe.

“This is peak travel season and there is a capacity crunch caused by cancellation of Jet flights. This has led to around 20 per cent escalation in fares. We expect 10 per cent increase in foreign tours costs,” said Rakshit Desai, managing director of FCM Travel Solutions. Jet suspended all its international operations last Friday leaving hundreds of flyers in the lurch. Till a few weeks ago, it was operating four times daily to London, thrice daily to Amsterdam, two flights to Paris, besides multiple ones to South East Asia and the Gulf countries.

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Already, capacity on overseas routes to/from India was flat and airlines were expected to increase fares by 10 per cent — the Jet grounding has sucked out capacity further and led to an increase in fares. The closure of Pakistan airspace is another factor as it has pushed up operating costs for airlines. An Air India executive said fares on Europe routes were higher by Rs 4,000 to factor in the increase in costs due to higher flight duration. “Very few seats are available on routes which were being operated by Jet and what is available is at least 50 per cent higher,” said Pradip Lulla, vice-president of Travel Agents Federation of India. The travel industry was not factoring in total collapse of Jet and many believe the airline would revive. There are a large number of customers holding on to the Jet tickets in May and June. “Airfares in the next 10 days to key tourist destinations have gone up by at least 30 per cent which makes holidays dearer. However, fares for the second week of May are relatively cheaper, if booked now,” said John Nair, head-business travel, Cox & Kings. “With the peak travel season kicking in, we see airlines inducting more aircraft to fill up the demand-supply gap, thus rationalising airfares on key routes.

Last minute fares have risen due to suge in demand on business and leisure routes but for leisure travellers booking well in advance, the difference in fares would be only 5-10 per cent,” said Sharat Dhall, COO (B2C), Yatra.com.

Indiver Rastogi, president & country head, Holidays, (MICE Visas) Thomas Cook India, said, “The cancellation of flights is creating an imbalance on the supply side in the face of peak demand and the resultant rise in fares is affecting us across our business, leisure and B-leisure segments with immediate impact given that this is the key vacation season for India.”
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First Published: Wed, April 17 2019. 22:26 IST