Nirmal John

Mumbai: Jaya Singh is very worried. The media executive’s travel bills are shooting up on a monthly basis as airline companies, reeling under the effect of high fuel prices, passing on the burden to the flyers.

This month, too, consequent to a near 10% revision in the prices of aviation turbine fuel (ATF), airlines are hiking fuel surcharges. And this is pinching people like Jaya,who used to fly only for official purposes in the pre Air Deccan era.

The fuel surcharges would become Rs 1,950 for short-haul routes and Rs 2,350 for long-haul routes. This works out to a hike of Rs 150 for short-haul routes and Rs 350 for long haul routes.

Analysts say that it is difficult to blame the airlines for the predicament passengers are facing.

Crude oil levels of $120 a barrel is more than double the price last year. Not surprisingly, fuel surcharges of Rs 1,950 and Rs 2,350 are also more than double what passengers shelled out last year.

Last month, when oil breached the $100 a barrel levels, airlines faced a 13% fuel hike, which was then distributed differentially to the traveler with surcharge hikes in two slabs, either side of a 750km distance.

Which begs the question, there a tipping point when passengers would say enough is enough and turn their backs to air travel?

Passengers like Jaya would have to grin and bear it, says, Mark D Martin, senior advisor-aviation, KPMG.

“Inflation is a fact of life now. And people have made up their minds to travel by air. Otherwise you wouldn’t see so much growth out of tier two or tier three towns. Places like Indore are seeing huge growth. Travellers would love low fares but they do understand that not much can be done.”

G R Gopinath, the pioneer of low-cost travel and founder of Air Deccan, agrees.

“An idli used to cost Re 1, but now in any Udupi restaurant it will cost Rs 10. This kind of a rise in linked to inflation. Oil was $30 a barrel when I started Air Deccan. Pilot salaries have also shot up from Rs 1.5 lakh back then to over Rs 6 lakhs now. What is important is that the fares are still substantially lower than what they were in 2003.”

At a time when Indians are realising that time is money, the question seems to be why would people want to spend 24 hours in a train when they can spend 2 hours and get to the destination? Santosh Desai, CEO of Future Brands, brings in the perspective of the consumer.

“It would be fair to say that consumers have become more inelastic to these price hikes and have become less concerned about them. This is due to the fact that it is very difficult to downgrade once you become used to a particular mode of travel. It is in terms of new fliers coming in that these hikes would impact numbers.”

Akhilesh Dixit, a Mumbai-based passenger, adds an interesting twist. “I would consider switching to trains such as the Rajdhani Express for overnight journeys to say, Delhi. But for going to cities like Kolkata, the faster transit time can make up for a higher fare.”

Source : DNA