Domestic airfares record downward trend in 2Q

CHENNAI: India's domestic airfares manifested a downward trend in the second quarter of 2007 even as the Intra Asia Pacific routes witnessed a growth similar to that in the average airfares across Asia Pacific region, an agency monitoring the industry trends said.

According to the market trends published by American Express Business Travel Monitor, published airfares in India were down by one per cent compared to the previous and the yearly estimates.

"While the domestic fares fell by two per cent for the quarter, Intra Asia Pacific routes saw a steady increase of four per cent", Kurt Knackstedt, Head of American Express Business Travel Advisory Services, said.

However, in China full and discount economy fares saw the strongest increase by 18 per cent for the quarter, largely driven by the growth in the US routes.

The increased focus by airline yield managers to maximise revenue on popular airfares also contributed to the growth.

The two per cent growth in the average airfares in Asia Pacific region compared to the flat results in the first quarter, was driven by the increased demand from leisure and business travellers. It also reflected the positive economic environment in the region.

"The Asia-Pacific region tends to demonstrate higher and more consistent profitability for its air carriers compared to the European and North American markets", Knackstedt said adding Asia Pacific carriers demonstrated better cost control.

Among different destinations, Intra Pacific routes grew fastest during the quarter at three per cent, even as the US routes continued their long-term growth at six per cent.