DGCA to monitor airfares after India suspends operations of Boeing 737 MAX

The Directorate General of Civil Aviation (DGCA) has said it would closely monitor fare movement from Thursday after India suspended operations of all Boeing 737 MAX 8s. A day after the suspension, ministry of civil aviation secretary Pradeep Singh Kharola said DGCA would ensure the grounding does not to affect passengers or operations.

SpiceJet cancelled 14 flights in the second half of on Wednesday. It operates more than 500 flights daily and has around 12 such aircraft. Jet Airways which is going through a financial crisis is cancelling more than 200 flights daily. Jet was forced to ground five more planes by lessors on Wednesday, the airline informed the stock exchange. The total number of grounded planes is now pegged at 59 which is nearly half its fleet.

“This is a significant reduction in domestic airline capacity. The additional capacity coming in is not likely to cover for this in the short term. Demand is going to be robust in the next few months due to holidays. The airfares are already 15 per cent higher than last season and due to this shortage it will go higher,” said Sharat Dhall, COO of Yatra.com.

Spot airfares for Wednesday and Thursday saw a steep rise on important routes. Yatra.com data showed ticket prices on Mumbai-Chennai routes increased to Rs 20,329 for March 14. The spot fare on March 14 last year was Rs 5,671. The Mumbai-Delhi ticket of March 14 has the spot fare of Rs 13,495, which is higher by 137 per cent when compared to the spot fare of March 14 last year.

Kharola said airlines have agreed to check on predatory pricing following last moment cancellation of several flights. Spicejet issued a statement saying, "SpiceJet is optimising the use of its Boeing 737 NG and Bombardier Q400 aircraft to address the current situation. We are evaluating options for augmenting capacity through a mix of additional flights and aircraft inductions. We are sure our operations will be normal soon.”

“Complying with the DGCA directive, SpiceJet has grounded its entire B737 Max fleet. A majority of passengers have been accommodated by SpiceJet on alternate flights. The airline is also offering the option of a full refund, changing the flight/date of travel, or change of destination (to the nearest alternate airport); all this without any cancellation charges or any fare difference,” it said.

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