Full, budget airlines to lock horns at meet

New Delhi: The October-16 meeting of the Indian carriers in Mumbai is expected to be a stormy one, with full service carriers and budget airlines likely to lock horns over issues like regulation of fares and putting up of stiff entry barriers.
It promises to be a repeat of the meeting of airlines called by Civil Aviation Minister Praful Patel on September 28, at which full-service airlines demanded government intervention in regulation of fares and entry barriers as a way out of the financial crisis being faced by the industry.
Airline sources said full service carriers would push for budget carriers agreeing to a base price, so that revenues and yields were protected.
In order to ensure that a carrier’s financial health did not lead to bankruptcy, and to curtail predatory pricing by carriers, the government had proposed to review the business plans and financials of airlines every quarter and suggest corrective measures. The government said it was borrowing the model from the US.
At the same time, some other full-service carriers are of the view that pricing should be left to market forces.
12/10/06 Business Standard

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