Patel warns against cartelisation; DGCA seeks hike details

Thursday, February 12, 2009 at 3:02 am

A day after major airlines raised their minimum fares, the government today acted tough against any cartelisation move, with a stern warning coming from Civil Aviation Minister Praful Patel and the DGCA asking air carriers to furnish details of the fare hike.

“Our Ministry is against any cartelisation among airlines. We will keep a watch and take strict action in any such case,” Patel said here.

His comments follows major carriers’ decision to stop promotional advance purchase or APEX fares to arrest losses, though Air India said its fares will be 10 per cent lower than the cheapest rates of Jet Airways and Kingfisher.

Patel said Air India will “never be a part of such cartelisation and will ensure that competitive pricing ensures better prices to passengers”.

Soon after Patel’s warning, the Directorate General of Civil Aviation today wrote to all the airlines asking for details on the recent fare hike, official sources said.

Any action, if required, would be taken on the basis of the reports received by the DGCA from the carriers, they said.

Though major airlines decided to stop their low fare schemes, an Air India spokesperson said the passengers, while enjoying fares cheaper than those of the private players, would get an additional 10 per cent discount if they bought tickets through the website.

Reacting to reports about cartelisation, he asserted that AI “does not and will not participate in any price fixation attempt or mechanism aimed at building a cartel.”

The recent changes in fares on domestic routes were undertaken “solely as a response to the changed market situation and did not occur simultaneously with the increase in fares by other carriers,” he said, adding the fare hike was resorted to due to numerous factors including demand and competitive environment.

Air India, the spokesperson said, would continue to offer attractive fares to ensure that air travel was “viable and affordable” for passengers.

Spokespersons for private carriers, Jet and Kingfisher, also said they followed dynamic pricing and adjust fares on a regular basis depending on market conditions and revenue management practices.

(Agencies)

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Patel warns against cartelisation; DGCA seeks hike details

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