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Patel warns domestic airlines against predatory pricing news
25 November 2010

Taking serious note of some airlines' price gouging, the government today said that the air fares on every sector/route should have a lower and higher price band, which airlines would need to notify on their websites.
"Fares on lower and higher price band on every sector will have to be notified. It has to be in the public domain on each airline's website on what would be the fares on higher price band," civil aviation minister Praful Patel told reporters in New Delhi on the sidelines of Ficci's aviation conference.

He further said that the government and the director-general of civil aviation have taken a serious view of the 'exorbitant prices' being charged by the airlines on most of the routes and had issued notices to them.

Commenting on reports that spot bookings for certain routes, including Delhi-Mumbai, had soared to as high as 300 per cent post Diwali, Patel said predatory pricing of the kind could not be justified and it was unfair to passengers.

Aviation regulator DGCA has, in a circular, directed carriers to "furnish a copy of the route-wise tariff across its network in various fare categories, in the manner it is offered in the market, to DGCA on the first day of every calendar month."

The circular calls for reporting of any "significant and noticeable change" in the established tariff already filed (by an airline), "within 24 hours of effecting such changes".

The circular said insufficient and inadequate information available in the public domain on airfares and reports of scheduled airlines charging excessive high tariff was "causing lot of inconvenience to the travelling public and drawing adverse comments on airfares."

The regulator has also asked airlines to regularly publish air fares on their websites or in daily newspapers.

The DGCA is also reported to be investigating whether the sudden spurt in prices is because of manipulation by the travel industry.

It is alleged that the low-fare seats are reserved in advance by the travel industry leaving only the higher-fare seats available to the general public. When these seats are sold out, the lower priced seats booked fictitiously are made available at higher prices.

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Patel warns domestic airlines against predatory pricing