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Looking to avoid price war; Akasa entering market at tough time: SpiceJet Chairman

aviation | IST

Looking to avoid price war; Akasa entering market at tough time: SpiceJet Chairman


Price wars in aviation will create monopolistic situations, hurting the sector, he said.

In an exclusive interview with CNBC-TV18, SpiceJet Chairman & MD Ajay Singh said, Rakesh Jhunjhunwala-backed Akasa Airways is entering the sector at a very challenging time and hopes to avoid a price war with new competition.

"As far as new entrants is concerned, competition is always good, it makes you more efficient. However it is a terrifically challenging market that Akasa Airways is entering. They are also not entering at the best of time because of the after effects of COVID, price of oil and currency issue and so on. But I am sure they will find a way to make their business viable."
He said price war in aviation creates monopolistic situations, hurting the sector.
"The aviation industry has had many price wars. Ideally we all need to work on reducing cost of Indian aviation. Price wars are always unhealthy for the sector, it creates monopolistic situations. So it is important that people are selling above cost."
India has been one of those markets where costs have traditionally been very high because of the taxes imposed on aviation, while fares have remained very low, he added.
Singh said reduction in airport charges and bringing aviation turbine fuel (ATF) under the Goods and Services Tax (GST) regime, are extremely important for the sector.
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