Bengaluru: Domestic airlines are likely to increase ticket fares in the coming weeks after the price of jet fuel or aviation turbine fuel (ATF) was hiked on Sunday by a steep 6 per cent. This was done citing firming of international rates.
The recent increase in the price of ATF is the third straight increase since August, the last being 4 per cent on September 1, thus adding to the economic burden on airlines.
According to a notification released by India Oil Corporation, ATF will now cost Rs 53,045 per kilolitre (kl) in Delhi, Rs 3,025 per kl more than Rs 50,020 previously.
A source in a leading private airline said the hike in fares is inevitable as there was no option left. “It is anyways the festival season and the prices are generally high. But this time around with the ATF price rise, we have to transfer the additional cost to the passengers as the airline cannot bear that," said the source.
ATF accounts for 50% of an airlines operational expenditure. The hike in rates will also cut into the profit margins of carriers.
Another source in a full service carrier said that, at least now, the discounted prices will stop after the ATF hike. “It is most likely that the last minute discounts will vanish now," said the source.
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