Indian low-cost carriers propose massive price hikes

Low-cost carriers in India such as SpiceJet and Indigo proposed to hike flight charges to levels that would make the 'low-cost' tag redundant.

Under the proposal that was submitted to the Directorate-General of Civil Aviation (DCGA) earlier this week, fares will now be decided on a four-slab basis, set according to the distance. The price hikes nearly triple ticket prices for those flights booked on a short notice.

Low-cost airlines such as JetLite, SpiceJet, Indigo and GoAir have begun following the western pattern of no-frill flights. Passengers have to pay for food and other amenities on these flights. But as the demand surges, many of these carriers are looking to boost their profit statements.

However, the proposed hikes will nearly triple airfares. A Delhi to Bangalore round trip could cost as much as 40,000 rupees (about $887) from what currently costs 10,000 rupees (about $221).

The move comes after the DCGA asked all carriers to publish tariff information on the first of every month to maintain records and for inspection.

The DCGA said it would look into the proposal, while some media reports stated that the aviation governing body would dismiss these proposals.

This raise makes the economy class a silly joke. It takes us back to the time when air travel could be afforded only by a select few, Shashank Kaushal, who is involved in digital marketing in Mumbai, said.

The first low-cost carrier - Air Deccan - was launched in 2003. Since then, the addition of several other major players like JetLite, Kingfisher Airlines and SpiceJet led to a massive price competition and changed the face of the Indian aviation industry.

Many people who previously looked to take the train began using flights, particularly as the outsourcing boom in India boosted pay packages of the younger generation.

The vast migration into the cities popularized air travel, which was faster and easier.

Even so, prices under the current proposal would put flying beyond the reach of many middle-class Indian citizens.

40,000 rupees is a little too steep. I will plan my travels such that I could use a cheaper mode - train, Rakesh Varma, a senior brand manager at an advertising firm in Mumbai, said.

According to makemytrip.com, a popular online ticket booking service, about 12,000 flight tickets are sold over day from their website.

The proposals by the aviation industry could backfire, pushing the industry behind instead of boosting profits as hoped. Though these massive price ranges are expected materialize only on tickets booked during the last minute, many people will shy away from such severe costs.

The Indian population, even if a little more affluent, still remains cost-conscious and simply cannot afford the massive hikes. There are also several other charges for people who are flying out of particular airports.

For instance, there is a maintenance fee for passengers who are flying out of the Bangalore International Airport. Though the airlines have not yet begun charging for checked baggage and every additional bags, like their American counterparts, this might only be a matter of time.

It would mean the end of air travel for me, and I say this for many others in my pay bracket, Kaushal said.