Airlines are looking at 10%-15% hike in airfares due to sharp increase in aviation turbine fuel (ATF) prices every month since August 2017. The most recent increase came when oil marketing companies raised prices by 6%. These hikes come at a time when the rupee is weakening against the US dollar.
After the latest price revision, ATF will now cost Rs53,045 per kilolitre in Delhi, up Rs3,025 per kl from Rs50,020. This is the third consecutive monthly hike. While no airline came on record, they said the twin impact of costlier ATF and weaker rupee leaves them with few options but to raise fares unless they want to meet a Kingfisher - like fate.
In addition, from 1 August 2017 the government has started levying a regional connectivity cess of Rs5,000 on each flights. Most airlines have transferred this cost to passengers.