Ticket bookings down 7%-8% due to hike in airfares: OTAs The steep rise in airfares last week due to hike in Aviation Turbine Fuel (ATF) has resulted in a drop in bookings, with people deferring their travel plans, Online Travel Agents (OTAs) have said, as per a Business Standard. “We are seeing seven to eight per cent reduction in bookings since last week. Advance bookings have come down. But bookings closer to date are not impacted, as people have planned engagements and events,” said Sharat Dhall, President, Yatra. He added the rise in fares would lead to a five per cent decline in passenger traffic this month and, subsequently, a drop in fares. “While airfares on metro routes have increased 13 per cent compared to the corresponding period last year, the rise is 91 per cent compared to July 2013. The dramatic increase and the magnitude of the rise have definitely shocked travellers. Also, there is a lot more search, as people try to book better advance fares. We have witnessed queries-to-booking conversion falling about 15 per cent in the first week of September. We expect this to normalise through the next few weeks, as passengers get used to the revised rates. The booking composition hasn’t changed much, except for a couple of days between the announcement of the ATF price rise and the increase in airfares, wherein a lot of tickets were booked well in advance,” said Rajesh Magow, Co-Founder and CEO, MakeMyTrip. With the depreciation of the rupee increasing ATF costs and lease rentals, airlines face financial pressure. But following the rise in fares, bookings have dropped and passenger loads stand at about 65 per cent, considering this is a lean season in the domestic market. “The domestic market was growing nine to ten per cent. But now, it has become flat. I think overall traffic would fall five-seven per cent. I believe airlines would need to do a rethink about the fare rise, as capacity is increasing and demand has turned negative,” said Ankur Bhatia, Executive Director, Bird Information Systems. According to a travel sentiment survey commissioned by TripAdvisor, inflation, the falling rupee and high airfares are impacting holiday budgets. However, travellers are choosing to revise, not cancel holiday plans. Of the respondents, 46 per cent said high airfares were the major cause of the rise in travel budgets; 48 per cent believe airfares to popular tourist destinations have been consistently higher this year compared to the last. “Recent flight deals and discounted fares have not managed to reverse this perception completely, as 37 per cent believe air ticket sales do not offer lucrative discounts to popular or relevant destinations, compared with only 21 per cent who said recent airline deals and discounts have made flying cheaper,” TripAdvisor said.
Posted on: Sat, 14 Sep 2013 03:18:29 +0000
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