British Airways fares plummet

Now's the time to make that much coveted trip to the US or Europe. Airline fare discounts are on again, at an all-time low. This time around, the instigator is British Airways, which slashed its fares nearly 20 per cent beyond the 4-9 per cent commissions given to travel agents. The low fares, according to the airline, will remain till November 30.

British Aiways' move has compelled otherWest-bound airlines, including Air-India, to offer discounted fares to a host of destinations. Airline sources say that lean passenger traffic, owing to the onset of the off-season and Gulf carriers offering very low fares (30 per cent discounts besides the commission given to travel agents), have put pressure on the earnings of airlines operating from India.

The Gulf carriers too are suffering from low capacity. This is because many West Asian countries have cut down on the number of work permits issued to overseas workers, a sizeable number of whom are from India and form a good part of Gulf-bound traffic. As a result, Gulf carriers are falling back on US and Europe-bound traffic to boost volumes. The Board of Airline Representatives, besides appealing to the Director General of Civil Aviation to put an end to the fare war, has asked British Airways to explain its actions, citing the decision taken earlier this year by many airlines, including BA, to avoid undercutting one another.

Earlier this year, British Airways, along with Scandinavian Airlines, Lufthansa, Royal Dutch Airlines and Swissair, had decided to refrain from offering discounts. They had also appealed to other airlines to resist offering cuts. This decision was a result of the bitter experience of the 1997-98 off-season, when a spell of undercutting hit the bottomlines of nearly all West-bound airlines badly.

As of now, almost all West-bound airlines are matching British Airways discounts till it reverts back to regular fares.