Cash-strapped Indian airlines have reopened bookings for domestic flights from as early as 16 May, even though the government has not decided on when to lift a more than month-long suspension of flights.
No-frills carriers GoAir and SpiceJet Ltd have started accepting bookings for travel between all major sectors from 16 May. Others such as Vistara, AirAsia India and IndiGo have resumed booking tickets for flights from 1 June.
This comes a week after the Directorate General of Civil Aviation (DGCA) pulled up airlines for selling tickets even as the countrywide lockdown to prevent the spread of covid-19 remained in force. The regulator told the airlines to suspend such bookings till further instructions as the pandemic continued to spread.
Airlines were also told to refund full fares to those who booked tickets during the first lockdown from 25 March to 14 April for travel between 25 March and 3 May but could not travel due to the lockdown.
Spokespersons for IndiGo, SpiceJet, GoAir, Vistara and AirAsia India did not respond to queries from Mint.
Air India Ltd has, however, refrained from reopening its bookings, said a spokesperson for the national carrier.
A spokesperson for DGCA declined to comment.
Airlines are offering attractive fares to woo customers on their flights from next month. SpiceJet is selling a one-way ticket on 16 May from New Delhi to Mumbai for as low as ₹2,500 while a Bengaluru to New Delhi flight on GoAir costs ₹3,164.
The resumption of bookings reflects the precarious financial condition of India’s aviation sector. All the airlines are in desperate need of cash as the unprecedented lockdown has forced the grounding of hundreds of aircraft. India’s aviation sector, including airlines, airport firms, ground handling companies and airport retailers, is expected to post losses of $3-3.6 billion in the June quarter because of the covid-19 pandemic, according to aviation consultant Capa India.
Since the government, unlike some of its global peers, has still not shown its inclination to bail out the aviation industry, airlines are taking their own measures to generate revenue, said a senior airline official, seeking anonymity.
“Airlines are doing whatever necessary to survive,” the official said.
Airlines have, however, been panned by the government and the people for accepting bookings and locking people’s money away, during the lockdown period. In most cases, the money isn’t refunded, with the airlines creating a “credit shell” for customers and agents for making fresh bookings within a specified timeframe.
The desperation of airlines to generate revenue is also hurting online and offline travel agents.
To this extent, all travel agents have to deposit money (in online wallets) with airlines such as IndiGo, SpiceJet, GoAir and AirAsia India in advance for booking of tickets.
Travel agents can book tickets worth the balance in their wallets. However, at the time of refunds, airlines do not transfer the funds to the agents’ bank accounts directly, but load the refund amounts in wallets that could be used for bookings later.
This comes after the civil aviation ministry directed airlines on 16 April to refund full fares, without imposing cancellation charges, to those who booked tickets during the first lockdown from 25 March to 14 April for travel between 25 March and 3 May.
“The fact is that refunds are being loaded in wallet (and not in cash),” said Nishant Pitti, co-founder of EaseMyTrip.
With DGCA directing airlines not to start bookings till further notice, such wallet balances are swelling as more people are opting for full refunds. “Travel agents’ money is blocked till we start getting fresh bookings,” Pitti said, adding that he is left with no options but to initiate refunds from his own cash flow.
News Source: Livemint