New Delhi: Amid rising concerns over higher airfares despite a fall in oil prices, no-frills airline IndiGo has acknowledged that it is not "passing on all" the benefits accruing from lower fuel costs to its customers.
The steep fall in international crude oil prices in recent times has provided a boost for airlines as ATF (aviation turbine fuel) costs account for over 40 per cent of a carrier's total operating costs.
IndiGo president and whole-time director Aditya Ghosh said the airline continues to use the low cost fuel opportunity to lower fares and register strong increases in passenger numbers.
However, the full benefits of the fall in fuel prices are not passed on to the customers, he said.
"If you look at fourth quarter (January-March 2015-16), then fuel prices came down 29.5 per cent whereas the average fares came down I think above 15.2 per cent."
"So clearly, we are not passing on all of its back to the customers, but of course the lower fuel prices and the lower average fares also has a positive effect on our load factors," he said in a post-earnings conference call last week.
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The steep fall in international crude oil prices in recent times has provided a boost for airlines as ATF (aviation turbine fuel) costs account for over 40 per cent of a carrier's total operating costs.
IndiGo president and whole-time director Aditya Ghosh said the airline continues to use the low cost fuel opportunity to lower fares and register strong increases in passenger numbers.
However, the full benefits of the fall in fuel prices are not passed on to the customers, he said.
"If you look at fourth quarter (January-March 2015-16), then fuel prices came down 29.5 per cent whereas the average fares came down I think above 15.2 per cent."
"So clearly, we are not passing on all of its back to the customers, but of course the lower fuel prices and the lower average fares also has a positive effect on our load factors," he said in a post-earnings conference call last week.
To Read the News in Full
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