With the air fares already surging amid the ongoing cricket world cup and the soon-to-begin festive season, it seems that air travellers in India will?need to dig deeper into their pockets.
Leading airline?IndiGo has already announced the inclusion of fuel charges to their ticket prices. The new pricing structure is set to make air tickets cost even more and other airlines are expected to adopt it soon.?
But why are airlines doing so? Well, in response to rising aviation turbine fuel (ATF) charges, Indigo announced the inclusion of a fuel charge, effective from last week (October 6). This fuel cost will range from ?300 to ?100, depending on the distance, on its domestic and international routes.?
"The decision follows the significant increase in ATF prices, which have surged in the last three months with consecutive price hikes every month. ATF accounts for a substantial portion of an airline's operating expenses, necessitating fare adjustment to address such a cost surge," Indigo said in its statement last week.
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The impact of the inclusion of fuel charges in ticket prices is expected to push the already soaring air fares up by an additional 7%-12%, as per Hindu Business Line. The fuel charge that is being included in the ticket cost, will range from ?300 to ?1000.
According to the press note, Indigo will now charge ? 300 for trips under 500 km, ? 400 for distances between 510 and 1,000km, ?550 for trips between 1,001 and 1,500 km, ?650 for trips between 1,501 and 2,500 km, ?800 for trips between 2,501 and 3,500 km, and ?1,000 for trips more than 3,501 km.?
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Effective this month, the cost of aviation turbine fuel, or jet fuel, was increased by 5 per cent. This is the fourth straight monthly increase since July. According to price notification of state-owned fuel retailers, jet fuel has been increased by ? 5,779.84 per kilolitre, or 5.1 per cent, in the national capital to ? 118,199.17 per kilolitre from ? 112,419.33.?
This fourth straight increase in prices of jet fuel, which makes up for 40 per cent of an airline's operating cost, has increased the burden on already financially strained airlines. As per NDTV, the increase comes on the back of the steepest-ever 14.1 per cent increase (Rs 13,911.07 per kilolitre) effected on September 1, and an 8.5 per cent or ? 7,728.38 per kilolitre increase on August 1.
Notably, in July, ATF price had gone up by 1.65 per cent or ? 1,476.79 per kilolitre. In four increases, ATF prices have gone up by a record ? 29,391.08 per kilolitre.
Manan Bajoria, Group VP, Growth at Ixigo, shed light on the situation, stating, ¡°Fares were already trending higher for the festive months of October and November due to high travel demand. Additional fuel charges by airlines will increase fares by ? 400-500 across key routes.¡± For example, an IndiGo Delhi-Mumbai one-way flight that previously cost an average of ?4,700 has now surged to ?5,300, marking a 12 per cent hike.
Bharatt Malik, Senior VP ¨C Flights and Hotel Business at Yatra Online, anticipates ticket prices may see an increase ranging from 5 per cent to 7 per cent. ¡°We are closely monitoring the situation and keeping a vigilant eye on any price adjustments made by airlines,¡± he stated.?
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