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Amid capacity crunch and woes of Jet Airways, the aviation industry is unlikely to see softening in airfares at least until July 2019 as per a report. Further, even as the issue is being looked after and a handful of the Jet Airways slots are being allotted to other major airlines such as Indigo and Spicejet, passenger woes will continue to remain due to high airfares. Further, a CARE Rating report suggests moderation in domestic flying to 8-12%.
But with the boost up in international operations, flight fares for international spots will cool off at the fastest pace in the 2 months to July. This is majorly as airlines across the board are increasing their international presence either with more budget seats on offer or more connectivity.
Also, Jet Airways woes mean a better operating margin for other airlines as indicated in a CARE Ratings report which says, With reduced competition and improved airfares, operating margins for airlines would improve during FY20. We do expect all airlines to report operating profits during FY20". However, the profitability will highly depend on the prices of crude oil, it added.
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