India Insight

Fare wars over India: You win, airlines lose

(Any opinions expressed here are those of the author and not of Reuters)

Indians like it cheap — be it a car, a phone call or airfare. If that plane ticket is about 25 percent cheaper than a train ticket, you can imagine the rush to buy.

Airlines in India are doing just that. Jet Airways, until recently the biggest Indian carrier, offered 2 million tickets at nearly half price in a “goodwill gesture”. Its website crashed soon after, just as SpiceJet’s did when it offered a million tickets for just 2,013 rupees  last month. That led many to believe the offer was a hoax.

I was lucky to book a New Delhi-Guwahati return ticket for March, paying just 3,578 rupees compared to the 13,047 rupees I paid for a one-way ticket as recently as November, and 4,420 rupees for the cheapest round-trip ticket on the Rajdhani Express, India’s premier long-distance train.

No doubt reduced fares are excellent news for consumers. But does it make business sense?

Indian airlines hardly make money, and everyone knows the fate of Kingfisher Airlines. High fuel prices and expensive airports make India a tough sell for airlines, with tickets usually priced below cost. State taxes up to 30 percent make jet fuel more than 50 percent more expensive in India compared to the global average, one of the reasons why foreign carriers prefer to stay away from the local market.

The Jet strike: Where does the buck stop?

The distraught foreign national and her wheelchair-bound mother on TV is a compelling argument against the Jet Airways pilots’ strike which has dragged on for four days.

The stand-off between the pilots and the airline management over the sacking of four pilots has forced the airline to cancel hundreds of flights, affecting at least 14,000 passengers since Tuesday.

The public inconvenience caused by such strikes is so pressing that the cause of the strike almost always seems petty.

Tears, threats, triumph in Jet Airways layoff drama

jet.jpgI was on a Jet Airways flight from Delhi to Mumbai on Wednesday, the day the airline said it may lay off a further 1,100 employees in addition to the 800 it had retrenched.

Outside the Delhi airport, TV news channel vans had lined up; inside, Jet staff at the counter tried not to meet the sympathetic eyes of passengers. Aboard the aircraft, which had telltale empty seats, newspapers folded into seat pockets had headlines of the layoffs.

I wondered if any of the efficient stewards and stewardesses had been tempted to rip off the covers, or if they were just relieved they were not on probation.

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