NEW DELHI: The Directorate General of Civil Aviation on Thursday warned airlines against trying to cash in on the demand-supply crunch caused by Kingfisher's massive flight cancellation in this peak travel season. DGCA chief Bharat Bhushan said airfares are being monitored very closely. In past few days, airfares have soared as almost all airlines are charging at the upper end of their fare levels.
"There are price bands. Probably, airlines are operating on the highest bands. ... Some upward movement due to large scale cancellations by a big airline (Kingfisher). We are closely monitoring the fares. They should not go beyond the price band," Bharat Bhushan told reporters. The biggest problem is being faced by passengers of cancelled flights as they have to book last-minute tickets from other airlines at the highest possible fare levels. Kingfisher has cancelled a large number of flights since last week. Bhushan said he expected fares to "level off" soon.
The government's power to monitor fares is very restricted as airlines have been asked to specify a fare range for each sector every month and be within that range. Changes, if any due to factors like hike in operating cost, van be made only after informing the regulator.
However, this means an airline can say it will charge between Rs 4,000 and Rs 25,000 for any sector, so no action can be taken if it charges towards the higher end of the spectrum.
But the aviation ministry has now decided to act in one area where it has full power - airlines taking slots and simply blocking them by not operating flights on many of them.
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