The air-fare war doesn’t seem over

Bangalore: With the annual lean phase (mid-February to mid-April) of the aviation sector about to set in, hint of yet another price war is in the air.
Budget carriers Air Deccan and SpiceJet have already announced their special offer prices for the season.
While Air Deccan has opened booking of three lakh of its seats at Rs 7 per ticket, SpiceJet’s fare for 99,999 seats during this period is 99 paise.
Other carriers are waiting. “We have our check fares in place but our pricing strategy will depend on the market situation. The price will be fixed according to competition,” says Jet Airways CEO Wolfgang Prock-shauer.
He may be forced to give in to the price competition because an enlarging inventory of seats - carriers are getting deliveries of additional planes would have to be filled up in the lean season. The answer to overcapacity and lower demand is just one — aggressive fares.
The lean-season traffic is around 10-15% lower than peak season. So even Kingfisher Airlines, which is not a price warrior, will bring down fares.
25/01/07 Praveena Sharma/Daily News & Analysis

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