Air India has decided to cut fares on key domestic routes for the third time in as many months, even as aviation turbine fuel prices maintain a downward spiral. Fresh cuts will bring fares down by half since October 2008.
Effective from Thursday, an economy class ticket on the Delhi-Chennai, Mumbai-Chennai and Kolkata-Chennai sectors will cost Rs3,024, including taxes. While the basic fare is at Rs99, the fuel surcharge is at Rs2,700 and airport charges are at Rs225.
On short routes, a Bangalore-Chennai or Hyderabad-Chennai ticket, for instance, now costs Rs2,274, including taxes. The airline had cut fares by up to 62 per cent in December on select routes.
Fuel accounts for more than 45 per cent of an airline's operating costs. Over the past five months prices of ATF have dipped by about 55 per cent to Rs30,457 per kilolitre and are now quoting at near-July 2005 levels.