International airfares rise 50% on higher demand, jet fuel costs

Airfares to popular destinations such as London and New York have surged 45-50 per cent over the pre-pandemic period driven by high demand, limited capacity and increase in jet fuel price.

Seats are difficult to get on flights to Europe and US and those that are available fall in the higher slabs. United and Air Canada’s move to suspend flights (San Francisco-Delhi, Vancouver-Delhi, Newark-Mumbai) due to restrictions on use of Russian airspace has also curtailed availability of seats on the India-North America market.

“International airfares have risen as high as 45-50 per cent on some popular routes this year as compared to pre-Covid times due to rising fuel prices. Lowest one-way fares for routes like Mumbai-New York for May will cost travellers anywhere between Rs 48,000-67,000. However, despite rising airfares, interest in international travel this summer is strong due to pent-up demand. Amongst destinations, search queries for UAE, US, UK and Canada are seeing a week on week growth,” said Aloke Bajpai, group CEO and co-founder, ixigo.

Scheduled international passenger flights commenced on March 27 after a gap of two years. This has widened travel options for passengers as airlines are now allowed to sell tickets to onward destinations.  On Tuesday there were 704 international flights to/from India which is around 41 per cent lower than winter 2019.

Delhi, which is the country's busiest airport, is currently seeing around 85-90 international departures daily compared to around 135-140 departures prior to the pandemic.  In terms of connectivity from Delhi, Australia and North America have seen an increase in number of flights compared to 2020 but in the case of Europe recovery of capacity is only around 50 per cent. In case of East Asian routes the recovery is less than 40 per cent, it is learnt.

“The supply demand imbalance will not get restored overnight. Airlines will look at aircraft and crew availability before increasing their flights. Airlines are also looking to improve yields and cut losses as fuel prices remain high,” said Isha Goyal, CEO of Stic Travel Group.

“With crude prices on a boil and the geopolitical tensions in Eastern Europe, airfares for some medium to long haul routes are up to 15-60 per cent compared to April 2019,” said Pushan Sharma, Director of CRISIL Research.

Business class fares to US which cost around Rs 2,60,000-2,70,000 before the pandemic now cost upwards of Rs 4,00,000, said Abbas Moiz, general secretary of Travel Agents Federation of India.

Infact airfares on international routes have been on an upswing since late 2018 when Jet Airways began reducing flights. With Jet Airways suspending operations in April 2019 airfares rose across international routes.

Destinations closer home have not seen a significant rise in fares despite growing demand, said Indiver Rastogi, president and group head (global business travel), Thomas Cook India and SOTC. Airfares to Dubai, Abu Dhabi, Maldives, Singapore and Thailand remain almost at par compared to 2019 levels, he added.