Air ticket pricing responds to demand/supply, says Sharma

Pricing of air tickets by domestic carriers runs at multiple levels that are in line with global practices and respond to market dynamics, the government said today.
In recent times, concerns have been expressed in different quarters about steep fluctuation in air ticket prices, with some even demanding capping of airfares.
"Air fare pricing forms the strategic framework of airlines to respond to the demand/supply and market dynamics through the Inventory Management Process," Minister of State for Civil Aviation Mahesh Sharma told the Rajya Sabha.
"The domestic airline pricing runs in multiple levels (bucket or Reservation Booking Designator) which are in line with the practice followed globally," he said in a written reply.

According to him, lower levels of fares are assigned to advanced purchase bookings.
"As time lapses and date of journey approaches closer, (from seven days to date of departure), the fare in higher side of fare bucket are available for purchase," he said.

The Minister was responding to queries pertaining to air fares, including whether there are any regulations for fixing ticket prices for private airlines.
Sharma also noted that airlines remain compliant to the regulations as long as the fares charged by them do not exceed the fare structure displayed on their websites.
As per a provision in the Aircraft Rules, 1937, every air transport undertaking engaged in scheduled air services is required to establish tariffs having regard to all relevant factors, including the cost of operation, characteristic of services, reasonable profit and the generally prevailing tariff prices.