Oil PSUs hiked the prices of jet fuels by 3% on Thursdat, and consequently the domestic airlines Jet and Kingfisher-Deccan decided to increase their basic fares from Friday. The hike in the air fare has been on constant increase from past some time now, due to basic reason of rise in the crude oil prices.

The basic fares of economy and business class of Jet airline will be increased by10% and 5% respectively. On the other hand, Kingfisher-Deccan will increase the fare by 10% across all classes. This clearly points that the economy class fares of these carriers will rise in the range of Rs 50 to Rs 1,000 or even more.

Under the circumstances of high crude oil prices, other airlines such as Air India (domestic) may also hike their fares Friday onwards.
The passengers for full service airline’s Delhi-Mumbai economy class ticket will have to pay around Rs 7,105 to Rs 14,080; whereas earlier they had to spend Rs 6,775 to Rs 13,120 on the same inclusive of taxes and surcharges.

Business class tickets will also get expensive, with an increase of Rs 500 to Rs 2,000 per ticket. Domestic airlines will pass the entire rise in the fuel prices on their customers, for the airlines are already expected to lose up to Rs 10,000 crore.

CFO of SpiceJet, Parthu Basu said, “Crude prices were touching record highs in first half of July and started cooling only later. So a hike in ATF was feared this time and hopefully prices may drop from next month. We will decide whether fares should be hiked in a day or two.”

The situation of Domestic airlines is quite miserable because the number of passengers has declined since the successive hikes in fares since April. The short and medium haul domestic flights have to pay an additional Rs 2,350 and Rs 3,100, respectively as there fuel surcharge. Another Rs 400 is added as other taxes and surcharge and basic fares are also high now.