Global air travel has turned out to be costlier by 5 to 10% as airlines have raised fuel surcharges.
The rise comes in the wake of spike in fuel price in the last few months. While demand for air travel continues to be strong, international fares from India have remained flat, more or less. As such volume growth has not led to revenue growth for airlines.
But then, airlines are currently modifying the fuel surcharges as yields remain under pressure.
Etihad has revised fuel surcharge by $10 for return economy tickets and $20 for return business or first class tickets issued on or after June 4. Thai Airways has hiked surcharge on one-way fare by $3.
Earlier this week Dubai-based Emirates informed agents of an upward rise in all its ‘strategic fares’ in cabins.
But then, the exact revision in fares by Emirates was not known. Cathay Pacific had informed travel agents on Thursday about revision in fuel surcharge by $1.9 for one-way trips on short-haul routes and $8.7 on long-haul routes.
Airlines have different fare slabs and Air India has also withdrawn its lowest fare slab on Mumbai-London route.
Consequently tickets on this route are currently priced at 4% higher.
Pricing actions typically reflect seasonality, demand and airlines’ revenue management tactics. The end of May marks the end of peak travel season for overseas travel from India and for carriers and sales efforts are driven to attract students travelling to the US.
Travel to and from Gulf countries is thin during the fasting month of Ramazan but demand for travel from that region increases post-Eid resulting in increased loads and fares to and from Dubai, Abu Doha or Doha.
On domestic routes, IndiGo has hiked fares reintroducing fuel surcharge of Rs 200-400 on domestic routes. Other private airlines are also expected to follow suit and increase the fares but so far none of them has announced it.