No cartelisation in airfares: competition panel
31 Dec 2012
The Competition Commission has once again said it does not suspect any cartelisation of air fares, and one possible reason for soaring airfares may be the suspension of operations by the financially crippled Kingfisher Airlines, which has been grounded since the beginning of October.
''If there was indeed a cartel, which is formed to make disproportionately high profits, the airlines would not have been making losses. But the fact is that none of them is making profits, so you cannot have a cartel," Ashok Chawla, chairman of the fair trade watchdog, said today.
Noting that the "sensitive" matter of carriers forming a possible cartel to push up airfares has been probed by CCI more than once in the past, Chawla said that he is open to looking into the matter again if there is something to show anti-competitive practices.
"I don't want to prejudge and if there is something we will look into it. At the moment, there does not seem to be anything (related to cartelisation)," he said.
Explaining the findings of CCI probes in this regard, Chawla said that the fares had gone down a few years ago when "supply was substantial and demand was picking up".
"After that when supply did not increase - in fact supply went down because of one airline slowly reached the stage of where it is non-functional - the demand did not go down to that extent," he said, in reply to a query on whether suspension of flights by Kingfisher has impacted the prices.
