SpiceJet Calls For Hike In Airfares To Avoid ‘Telecom-Like Monopoly’
While Jet Airways’ capacity has been recouped, more needs to be done to bring back passenger growth, says Ajay Singh.
It is up to India’s largest carrier to raise airfares to a “sustainable level” to create a level-playing field and “avoid the telecom sector-like monopoly”, according to SpiceJet Ltd.’s Chairman and Managing Director Ajay Singh.
“There are parallels and it is important that we ensure that there will be lessons learnt from telecom and applied to aviation,” Singh told reporters in New Delhi on the sidelines of signing a memorandum of understanding with Bahrain-based Gulf Air.
IndiGo, operated by InterGlobe Aviation Ltd., is the largest airline in India with over 47 percent market share as on October, followed by SpiceJet with 16.3 percent market share, according to data released by the Directorate General of Civil Aviation.
Singh’s remarks come at a time when India’s only two listed airlines posted their highest loss in the quarter ended September as costs rose and the rupee depreciated.
While Jet Airways’ capacity has been recouped, more needs to be done to bring back passenger growth, Singh told BloombergQuint in an interview. “We are still in a high-cost environment and need to bring down cost of aviation fuel, airports and look for ways to do service and repair of planes on our own.”
SpiceJet’s air passenger growth jumped to its highest in nearly four years in the seasonally strong October as India’s second-largest airline increased capacity and offered discounts. The industry’s domestic passenger growth, however, stood at 4 percent—the worst pace in October in at least six years and nearly one-fourth of the monthly average growth in last five years.
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