CCI to probe high air fares for 5th time; wants more details

With air fares soaring again, fair trade watchdog CCI is gearing up for a fresh probe into possible cartelisation among airlines to jack up prices, and it wants to gather more details this time around.

The Competition Commission of India (CCI) has already probed "four times" the alleged cartelisation among air carriers to jack up the fares, but could not find any clear evidence of cartel activities, CCI Chairman Ashok Chawla said.

However, CCI has received a fresh complaint earlier this month from the Air Passengers Association of India (APAI), which has alleged that airlines were acting as cartels to push the ticket prices.

Chawla said that CCI would need some more details to re-look at this cartelisation issue "intensively and vigorously" and the APAI would be asked for more details about the required information.

"We have looked into the issue of rising air fares four times already, and on all those occasions, we did not have find any clear evidence of cartel activities," Chawla told PTI in an interview.

Chennai-based APAI had approached CCI after a recent hike of as much as 25% in air fares by most carriers.

Chawla said that CCI would need more information from APAI to proceed further, as the price movements were found to be a function of supply and demand during its earlier probes.

CCI chief said that this matter has been looked into again and again, because the upward and downward movements in ticket prices have indeed been found to be in tandem.

At the same time, the prices had also been found to be moving in tandem with the forces of demand and supply, which is how a market should function and therefore no evidence could be seen of any cartelisation, he added.

In the first week of September, all domestic carriers, hiked their respective fares by about 25% after a steep rise in fuel prices.

The hike was first announced by low-cost carrier SpiceJet and followed by other players like Jet, Air India, Indigo and GoAir followed suit.

Earlier in July, Civil Aviation Minister Ajit Singh had also talked about an economic cell in his ministry to monitor the pricing mechanism.

"The airfare monitoring cell is ready and will soon be commissioned under the aegis of the ministry. The economic cell would analyse data on tickets sold by airlines under different price buckets and make the information public to bring in transparency in airfare pricing.

"In case there are discrepancies, it would be referred to the CCI," Singh had said.

Chawla said that nothing has referred to the CCI so far on these issues by the Aviation Ministry, although they can make such references if they wish to do so.