Airlines Warn of Possible Shutdown, Seek Government Action

Priyal Dutta2 months Ago1 Mins read393

Airlines Warn of Possible Shutdown, Seek Government Action

At least three airlines, including Air India, have approached the government seeking a review of ATF pricing.

Airlines Seek Government Support as Fuel Costs Rise

India’s aviation sector is facing pressure as airlines raise concerns over rising aviation turbine fuel (ATF) prices and their impact on operations. Carriers have indicated that continued increases in fuel costs could affect their ability to sustain services.

At least three airlines, including Air India, have approached the government seeking a review of ATF pricing. Fuel accounts for a significant portion of airline operating costs, and recent increases have added to financial strain across the sector.

The Federation of Indian Airlines, which represents airlines such as IndiGo and SpiceJet, has written to the Civil Aviation Ministry outlining concerns over pricing differences and recent increases in ATF rates.

According to the industry body, changes in pricing structures and rising costs could lead to operational challenges, including reduced flight capacity. Airlines have called for a more uniform fuel pricing approach across domestic and international operations, similar to earlier mechanisms used to manage price differences.

Impact of Global Developments

The current situation is linked to geopolitical developments, including tensions involving Iran and disruptions around the Strait of Hormuz, a key global oil transit route. A significant share of global oil supply passes through this corridor, making any disruption a factor in fuel price fluctuations.

Airlines have also requested temporary relief measures, including a deferment of excise duty on ATF, which currently stands at 11 per cent. They have noted that currency movements, combined with higher fuel prices, are adding to overall costs.

Long-haul routes are among the most affected, as they require higher fuel consumption and are more sensitive to price changes.

Industry Outlook

Airlines have indicated the need for timely support measures to manage cost pressures and maintain operations. The situation highlights the link between global energy markets and the aviation sector, particularly in periods of volatility.

Stay updated with the latest travel, aviation and tourism news on Safari India.

Written by

Priyal Dutta

I create compelling stories that showcase the travel, hospitality, and lifestyle industries. At Safari India, I explore industry trends, write insightful articles, and produce content that informs and engages readers. With a talent for storytelling and a strategic approach, I strive to inform, inspire, and spark meaningful conversations through my work.