Will ban on Boeing 737 MAX aircraft lead to increase in fares? 6 things to know

Yatra.com has said that at least 50 planes are out of action or grounded on the domestic front, owing to multiple reasons.
Will ban on Boeing 737 MAX aircraft lead to increase in fares? 6 things to know
Will ban on Boeing 737 MAX aircraft lead to increase in fares? 6 things to know

Airlines and aviation regulators around the world are suspending operations of the Boeing 737 MAX aircraft, after an Ethiopian Airlines flight crashed on March 10 killing all 157 passengers and crew on board. India too has suspended operations of these aircraft, and this has created confusion among people, with many wondering how their travel plans will now be affected.

Here are six things to know: 

Why are Boeing 737 MAX aircraft being banned?

An Ethiopian Airlines Boeing 737 MAX plane carrying over 157 passengers and crew crashed on March 10 shortly after take off from Addis Ababa. No one survived the fatal crash.

Just six months earlier, a Lion Air Boeing 737 MAX aircraft crashed shortly after take off from Indonesia, killing all 189 people on board. It was Indonesia's second-worst air disaster, after the 1997 Garuda Indonesia crash near Medan, which killed 234 people.

Following these two major crashes, airlines and governments across Singapore, Australia, UK and a number of other countries banned the Boeing 737 MAX aircraft over safety concerns.

What is India’s stance?

India too, on Wednesday suspended the operations of Boeing 737 MAX. It also banned the aircraft from Indian airspace, which meant that any airline flying this aircraft could not pass through Indian skies.

The Ministry of Civil Aviation tweeted, "DGCA (Directorate General of Civil Aviation) has taken the decision to ground the Boeing 737-MAX planes immediately. These planes will be grounded until appropriate modifications and safety measures are undertaken to ensure their safe operations. As always, passenger safety remains our top priority. We continue to consult closely with regulators around the world, airlines and aircraft manufacturers, to ensure passenger safety."

It further said that Boeing 737 MAX operations will stop, from or to all Indian airports. Additionally, no such aircraft will be allowed to enter or transit the Indian airspace effective 16:00 hours IST or 10:30 UTC.

Which airlines fly them

In India, SpiceJet and Jet Airways operate 17 Boeing 737-800 MAX aircraft. While SpiceJet has 12 aircraft, Jet has five planes of this type.

Due to financial troubles, Jet Airways had already grounded its aircraft and wasn’t operating its Boeing 737 MAX aircraft anyway. SpiceJet too, grounded them on Wednesday.

Cancellations and delays – how will you be affected?

SpiceJet announced cancellation of 14 flights on Wednesday and said that it will be operating additional flights from Thursday. Of the 76 planes in its fleet, 64 aircraft are in operation.

Yatra.com said that at least 50 planes are out of action or grounded on the domestic front, owing to multiple reasons.

“That is a significant reduction in domestic airline capacity. The additional capacity coming in is not likely to cover this in the short term,” Sharat Dhall, COO (B2C) Yatra.com said.

SpiceJet said it is rationalising and optimising the use of its Boeing 737 NG and Bombardier Q400 aircraft to address the current situation and minimise inconvenience to its passengers.” We are evaluating options for augmenting capacity in the coming days through a mix of additional flights and aircraft inductions. We are sure that our operations will be normal very soon,’ it said in a statement.

Additionally, the airline is also offering passengers the option of a full refund, changing the flight/date of travel, or even a change of destination (to nearest alternate airport) - all this without any cancellation charges or fare difference.

As far as international flights are concerned, according to Aloke Bajpai, CEO and co-founder, Ixigo, "Following the ban on Boeing 737 MAX in Indian airspace, international inbound flights have been affected. Post-DGCA announcement, 34 international flights flying into Mumbai and 12 flights bound for Delhi were cancelled."

Price hike

Following the ban, spot airfares saw a steep rise on important routes across the country. Apart from the grounding of the aircraft, school holiday season and Holi being around the corner, also contributed to high demand, further pushing up prices.

For routes such as Delhi-Mumbai, Delhi-Bengaluru, Chennai-Delhi, Bengaluru-Mumbai, Hyderabad-Delhi, Mumbai-Chennai, Mumbai-Hyderabad, prices saw a steep increase on Thursday, with some routes costing up to Rs 20,000.

On the Mumbai-Chennai route, the fare increased to Rs 20,329 on March 14. The spot fare on March 14 last year was Rs 5,671. The Mumbai-Hyderabad ticket for March 14 has a spot fare of Rs 17,501, compared to the spot fare of Rs 2,229 on March 14 last year.

Yatra says that the shortage of planes and high seat occupancies are expected to push airfares north in the short term. The airfares were at least 15% higher this year compared to last year, and owing to the current situation, airfares are expected to rise even further this season.

Overall, the aviation industry has been facing a tough time with Jet grounding flights over non-payment of dues, Indigo cancelling flights over pilots not being available and Mumbai airport also being partly shut due to maintenance.

What is the government saying?

The civil aviation ministry stepped in on Wednesday to take charge of the issue and called a meeting of all airlines. It has reportedly advised airlines not to go in for predatory pricing and said that it will be monitoring key sectors to detect any high fares. 

In a media briefing, Civil Aviation Secretary, Pradeep Singh Kharola said that they have advised airlines to not use it (grounding) as a reason to hike their fares and that airlines have assured them they will go as per normal routine. 

"While passenger safety is a zero-tolerance issue, efforts are already on to minimise the impact on passenger movement as their convenience is important," Civil Aviation Minister Suresh Prabhu tweeted on Tuesday.

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