IndiGo airlines may soon charge for check-in baggage, joining GoFirst as the aviation sector prepares for its revival and war surrounding pricing intensifies. In an interview to Bloomberg, IndiGo CEO Ronojoy Dutta said that the company is yet to take a decision pertaining to this because of caps imposed by the Union government as well as capacity limitations (which were recently lifted).
Fare unbundling, or the practice of breaking up the total fare into different components and charging customers individually for it has been in operation in some form for a while now in India’s aviation industry — such as when airlines are allowed to offer hand baggage only fares.
In February 2021, the Directorate General of Civil Aviation had said in a circular that as part of airline baggage policy, “scheduled airlines will be allowed to offer free baggage allowance as well as zero baggage/ no check-in baggage fares”. This is to ensure that the customer pays only for the services they wish to use, and that all services may not be required.
According to the report, IndiGo didn’t unbundle its fares in February. Now, they are waiting for things to settle down.“We’re waiting for everything to settle down before we lock something,” he said, adding that they are talking to the Union government. The aviation sector was severely hampered during the pandemic, during which time air services were suspended. Later, fare caps were imposed and flight capacity was limited as well.
Recently, the Union government had allowed airlines to deploy full pre-COVID-19 flight capacity on the domestic sector. In October, Dutta told IANS that the airline has drawn 'clear' defensive strategies as the sector is expected to become more competitive. He said IndiGo has three distinct lines of defence to ward-off competition.
“Our first line of defense is that we have the lowest cost structure in the world. Besides, our engines are getting more fuel efficient. Then, there is our service standard and the third is our traction with the customers in terms of our network. Build a great network, build great connectivity and make sure you have high on-time frequencies between major destinations," he said.