Airlines in no mood to reduce fares despite lower ATF prices

The impact of the cut will be evaluated before a decision is taken to pass on the benefits to the air traveller — this was the common refrain of most airline executives contacted for their reaction on the reduction in aviation turbine fuel prices, bringing them on a par with the price level of September 2007.

Welcoming the move as “good news”, Air India Executive Director Jitendra Bhargava said it should also be borne in mind that when the prices were shooting up month after month, the airlines were passing on “only part of the additional financial liabilities”.

“We will wait and look at the economic viability before any decision on reducing fares,” he said. Pointing out that the US dollar had appreciated significantly vis-a-vis the rupee, Bhargava said several major cost-heads of an airline were dollar-denominated.

As the peak winter travel season had just begun, the carriers would utilise this opportunity to make good their losses before they decide to slash fares, industry sources said, adding that the fares could start coming down by January and not before that.