New Delhi, Jan 1: In the backdrop of huge losses borne by airlines, Aviation Minister Hardeep Singh Puri has said the government is concerned that more airlines will shut down if predatory pricing continues. "Some predatory pricing is taking place" in airfares, the minister told reporters on Tuesday. Mr Puri however ruled out any plan by the government to regulate airfares. The remarks come amid high competition in the country's aviation sector, struggling against high fuel prices and other operating costs.
"The interesting thing that we have observed is that on Delhi-Mumbai route 20 years ago, the average fare was Rs 5,100. Today, the average fare is Rs 4,600. Some predatory pricing is taking place. It means people are selling tickets below their cost," he said.
"One of our concerns is that if there is predatory pricing, then the airlines will stop functioning. This is not Air India's problem only. Jet Airways got shut down. Before that, it was Kingfisher airline," he said.
IndiGo and SpiceJet - two of the country's biggest airlines - reported losses of Rs 1,062 crore and Rs 463 crore respectively in the second quarter of 2019-20. Other airlines have also reported losses in the quarter that ended on September 30, 2019.
Asked if predatory pricing is the reason for the ill health of the airlines, the minister said, "No, there are many reasons... Predatory pricing is one of the factors. But the profitability of an airline is dependent on (a) number of things."
Asked if the trend of predatory pricing has come down after regular discussion with the airlines, he said, "Yes, absolutely."
"It is (a) constant battle. An ideal situation from an airline's point of view is that they grow and they are also able to charge more fares. What fares they charge is their business. Our advice to them is to charge realistic fares," he added. "It should not be too high. And it is not in your business interests if you are imposing predatory fares."
The minister also said that the government is not planning to regulate fares. "No regulation. It has to be done within deregulation system.... If I put a cap on fare, the airline will start charging that cap only... that cap will become the normal fare... So, within a deregulated structure, we have to bring about an equilibrium," the minister said.
"Government, periodically, at my level or at secretary''s level, we sit down with the main aircraft operators and tell them it is in your interest not to allow such practices which undermine the civil aviation sector."
Comments
Let this fellow think for a while what could have been his approach when his daughter is put in Asifa's place. It gives suspicion that Mr. Gupta has some "Gupta" link with accused?. Why these fellows are devoid of humanity at least??......
Its a Small Issue to you because you are not a Human and that girl is not your Daughter. Cant imagine if you have a Daughter how she will react by hearing your Comments. Shame on you..
Really it is a small issue if you agrees that it also applies to my daughter,sister,and mother.
Mr. Gupta, it is a small issue because the innocent girl raped was not your daughter.
Aren't you a human, a father? Don't you have a child? Why don't they think before uttering words?
Not surprised. This is what I expect from Sangh Parivar. Your language shows your culture
If this is minor, then what is a major incident? Just because the girl is a Muslim the incident become a small issue for you?
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