Click to play videoNew Delhi: CEO of Jet Airways, Wolfgang Prock-Schauer, has defended the hike in air fares, saying there was no choice.
Speaking with CNN-IBN Prock-Schauer said India was a problem area due to high taxes. “Airlines do not have a choice. We are in a very serious situation due to rising fuel prices. In India, the prices are 70 to 80 per cent higher than the benchmark countries. This causes serious problems for all airlines,” he said.
Following are the excerpts from Prock-Schauer’s interview.
Fare enough: Will good times return?
Currently, all airlines in India are losing money. Last year alone, there was a $1-bn loss in aviation industry. The prices (input costs) we charge are too low and should be 20-30 pc higher. The relief in air fares can happen if input costs come down. Also India is a big problem area due to high taxes. If taxes can be cut - like in Andhra Pradesh and Kerala where sales tax have been cut by 4 per cent - it would be a relief.
Tough to fill seats?
No industry in long run can afford loses. So if this continues, airlines will have to look to restructuring routes. It will mean growth rates going down and flying at less capacity.
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