CCP to carry out study on avi­a­tion in­dus­try

The Pak Banker - - NATIONAL -

The Com­pe­ti­tion Com­mis­sion of Pak­istan (CCP) has com­pleted its en­quiry into the al­leged ex­or­bi­tant in­crease in air­fares by Air­blue and Sha­heen. The Com­mis­sion had taken no­tice of con­cerns ex­pressed over the me­dia and other fo­rums re­lat­ing to the con­duct of the two pri­vate car­ri­ers dur­ing the sus­pen­sion of PIA flight op­er­a­tions from Oc­to­ber 1-7 2015 and Fe­bru­ary 2-9, 2016. It was al­leged that fares had been hiked by as much as 300%.

A five mem­ber En­quiry Com­mit­tee was ap­pointed to de­ter­mine whether the pri­vate oper­a­tors had ex­ploited con­sumers dur­ing the time pe­riod un­der re­view by charg­ing ex­or­bi­tantly high air­fares. Air­blue and Sha­heen were asked to sub­mit de­tailed in­for­ma­tion on air­fares charged for each pas­sen­ger on do­mes­tic routes for the pe­riod un­der in­ves­ti­ga­tion as well as the pre­ced­ing months. The Com­mis­sion also is­sued a press re­lease ask­ing con­sumers to come for­ward and pro­vide ev­i­dence of tick­ets pur­chased at high rates.

It was ob­served that as per stan­dard in­dus­try prac­tice world­wide Air­blue and Sha­heen em­ploy a Rev­enue Man­age­ment Sys­tem al­low­ing them to set dif­fer­ent pa­ram­e­ters for de­ter­min­ing the ba­sic fare some of which are de­mand and sup­ply, size of the air­craft, the route, time of book­ing ticket, pas­sen­ger load on other air­lines etc. The low­est fares are in­voked when the book­ing is made well in ad­vance, as the time of the flight ap­proaches near the higher fare classes are in­voked de­pend­ing on the avail­abil­ity of seats.

The En­quiry Com­mit­tee an­a­lyzed air­fares on the ma­jor do­mes­tic routes of KarachiIs­lam­abad, Is­lam­abad- Karachi, KarachiLa­hore and La­hore- Karachi. The air­fares charged when PIA flight op­er­a­tions were sus­pended were com­pared with air­fares charged un­der nor­mal mar­ket con­di­tions i.e. the months im­me­di­ately pre­ced­ing each strike. The re­sults show that for Air­blue on av­er­age the change in fares when com­pared with im­me­di­ately pre­ced­ing month ranged from Rs 159 to a max­i­mum of Rs 2,766.

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