Air travel is going to get more expensive with the Vistara crisis widening the supply-demand gap.
Tata Group’s Vistara Airlines cancelling over 100 flights this week, so far, has left many fliers disgruntled. They are either facing flight delays or cancellations.
If the issue is not resolved soon, the cost of travelling by air will get dearer, said travel agents and platforms.
"Any curtailment of capacity is bound to impact fares, which are already high. If the issue is not resolved urgently, it does not bode well for the upcoming summer holidays," said Ajay Prakash, Board Member, Federation of Associations in Indian Tourism & Hospitality (FAITH), the apex body of the tourism and hospitality industry.
A travel agent said that Vistara passengers are annoyed due to the flight delays and are no longer making bookings with the airlines.
Supply-demand gap, airfare increase
There is already a supply-demand gap, and this has led to a 15 percent increase in domestic airfares. Consequently, Vistara fares could increase further, said Sanjay Dang, Managing Director of travel agency Le Travelworld.
India has over 3,000 flights per day and even small disruptions can cause temporary increase in airfares, especially since it's peak summer travel season now, noted Chirag Agrawal, Co-Founder, TravClan, a business-to-business (B2B) platform for travel agents.
"Those who are purchasing tickets now are looking at Air India, IndiGo, and Akasa as there is a lot of uncertainty around Vistara . Vistara is offering passengers refund and alternate flights, but what if someone has a morning meeting and Vistara is offering an evening flight? In that case, people have to make last-minute bookings, which are expensive. Booking a flight in the last minute can increase cost by 10-40 percent," Dang said.
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