Wed, Mar 22, 2006
How Low Can They Go? Fifteen Percent... That's It
A top official with Qatar's Civil Aviation Authority says the
organization will likely opt to maintain a 15 percent cap on the
differential in airfares between mainline carriers and low-cost
operators in the local market.
"If LCCs are allowed to offer fares that are much low than [full
service carriers], conventional carriers might be forced out of
operating on a particular route from Doha, affecting passengers who
wish to pay more but avail of better services," said Saleh Haroon,
Director, Air Transport and Airport Affairs (CAA). "Hence, we have
to regulate the fare difference that LCCs will be allowed to offer
in the local travel market."
The ceiling is essential, Haroon added, to maintain a level
playing field and insure that airlines take in enough revenue to
cover their operational expenses.
The CAA actually has
three tiers for airfares sold from Doha International Airport --
Direct, Indirect, and LCCs. Indirect carriers are allowed to offer
fares eight percent lower than those offered by airlines flying
direct from the city to a particular destination, while low-cost
carriers are allowed to offer discounts of up to 15 percent of the
direct fares.
"Hence, LCCs cannot dictate what should be our definition of a
budget carrier," Haroon said. "Though such carriers cut costs on
in-flight meals, operate newer, fuel efficient aircraft and offer
lower free baggage allowance, they still have other expenses on
crew and navigation."
Low-cost carriers flying from Doha are allowed to offer the
lower fare throughout the year, he added, regardless of peak travel
times.
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