Fare fight among Indian airlines mere eyewash?

AHMEDABAD: When Ankit Patel, a businessman, read about airlines offering 30-70% discount on tickets, he went online to book tickets for a trip to Mumbai next month. But before he could decide which date to book ticket for, low cost tickets were shown as unavailable.

In the past 10 days, leading low cost airlines have announced discounts of up to 70% for a limited period of time. But industry insiders say the high discounts are deceptive as only 5-10% seats in a flight are offered at low rates and that too on selected routes. Many customers like Ankit Patel were disappointed after they were unable to get tickets at low prices.

"People do not realize that the discount that airlines offer is available on the base fare and not on the taxes which constitute more than 50% of the total price of a ticket," said an airline official. For example, the total fare of a ticket for Ahmedabad-to-Mumbai flight on March 18 is Rs 5,237. Of this, the base fare is Rs 2,750 while taxes and other fees come to Rs 2,487.

Airlines follow 'bucket pricing' mechanism which basically means that the number of cheapest tickets is the least. Tickets priced higher are available in greater numbers. "There are usually 5-10 seats in a flight with the lowest fare and in some flights sometimes there are only one or two tickets. The offers announced by airlines are also dependent on the routes," said an airline official.

Domestic passengers have been flooded with many offers asking them to book early and save a good amount on tickets for travel during summer vacations. After announcing discounted fare schemes twice in the past two months, two low-cost airlines launched yet another offer asking for advance purchase of air tickets at discounted rates for mid-April to June period. "These airlines offer discounts to increase their market share. Through these offers they hope to get more passengers and show that carry the maximum passengers," said an airline official.