Air India cuts fuel surcharges as SpiceJet plans fare revisions

Air India said yesterday it will cut fuel surcharges by INR400 (Dh30) from today, following the sixth consecutive cut in jet fuel prices.

SpiceJet's spokeswoman Deepa Dey said the Gurgaon-based low-fare carrier was evaluating a cut in fuel surcharge or fares.

The country's airlines are under pressure, especially by the government, which has offered incentives such as extending the credit time to repay pending fuel bills to state-run oil companies, to lower air fares following a global fall in oil prices.

State-run Air India had said last month that it was considering a cut in fuel surcharge or ticket prices in a move to stimulate air travel amid an ongoing global aviation industry slowdown.

"Our current levels of fuel surcharge on INR2,350 (for routes up to 750km) and INR3,100 (for longer routes) will come down by INR400," Sanjay Sharma, a spokesman for the carrier said.

Last week, Air India had also cut a transaction fee, ranging from INR350 to INR10,000 on ticket purchases.

However, Jet Airways (India), the nation's top domestic carrier by marketshare, and rival Kingfisher Airlines said they had no immediate plan to lower surcharge or ticket prices. Oil-induced higher fares have slowed sales forcing carriers to cut flights, return extra-leased planes and defer taking delivery of new planes from Boeing and Airbus.

Air travel in the South Asian country grew just 1.5 per cent between January and October this year, compared with a 36-per cent rise a year ago.

Indian carriers flew 34.5 million passengers locally during the period, almost unchanged from 35 million a year earlier. They flew 25.8 million in January-October 2006.

Indian Oil Corp, the country's largest fuel retailer, lowered jet fuel prices on Sunday by 6.4 per cent to INR38,103 per thousand kilolitres for the first 15 days of December for Mumbai.

With the latest cut, Indian Oil has lowered jet fuel prices by 48.3 per cent since August.

"There are no announcements as of now," Jet Airways spokeswoman Srirupa Sen said, when asked if the Mumbai-based carrier planned to reduce fuel surcharge or cut ticket prices.

Prakash Mirpuri, a spokesman for the UB Group, which runs Kingfisher Airlines, said there was no change in either the fuel surcharge or airfares.

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