Air India to offer discounted fare scheme from Wednesday

Entering into a price war, Air India Tuesday said that it will launch its promotional fare scheme by offering 50 percent discount on all domestic routes from Jan 22.

The airline said that under its short-term spring sale passengers can avail 50 percent off on tickets booked from Jan 22-24 for travel between Feb 21 and April 15 2014.

"The scheme is unique as the fares are inclusive of all applicable taxes. The move will stimulate demand and help us in gaining market share as pre-bookings by passengers will ensure a high load factor during the lean travel season" an Air India official told IANS.

In December, Air India's domestic operations had a passenger load factor of 77.3 percent.

Under the new scheme airfare between New Delhi and Mumbai will come down drastically and will stand around Rs.2,830 from its spot fare of around Rs.10,000.

Other destinations like Delhi-Ahmedabad will be around Rs.2,292 on Agartala-Kolkata would be as low as Rs.1,385.

"These offers are targeted at leisure travellers with a longer booking horizon (1-2 months) and offer bigger savings to long-haul travellers,"said Rajesh Magow, co-founder and chief executive India, MakeMyTrip.

"Airlines are able to drive purchases further out, improve forward-loads and yields by incentivising earlier purchases and gain yield predictability by filling up seats earlier."

Air India is latest among airlines to offer such low prices. SpiceJet, IndiGo and GoAir have already started to offer the promotional fares.

"Travellers are finally getting a respite from the high airfares and will take advantage of these great prices to book their holidays in advance. We are already seeing over a 250 percent rise in bookings within hours of the prices being reduced,"said Sharat Dhall, president, Yatra.com.