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Airlines vs Government: Air India, Indigo, SpiceJet oppose Centre’s 60% free seat selection rule, warn of fare hike

Airlines vs Government: Air India, Indigo, SpiceJet oppose Centre's 60% free seat selection rule, warn of fare hike

indigo, air india And SpiceJet has protested against a government directive barring airlines from charging for at least 60 per cent of seat selection, warning that the move could drive up airfares.The Federation of Indian Airlines (FIA), representing aviation companies, has called on the Civil Aviation Ministry to reconsider the decision. In a letter to Civil Aviation Secretary Sameer Kumar Sinha on Thursday, the civic body said the directive may have unintended and adverse effects on the aviation sector.“The financial impact of the Directive on airlines will be significant, forcing airlines to recover lost revenue through fare increases. As a result, all passengers, including those who do not wish to pre-select seats, will have to pay higher fares,” the letter said. The FIA ​​stated that seat selection fees are a legitimate source of revenue for airlines, especially in high-cost operating environments.It said costs continue to increase annually under the regulatory Airports Economic Regulatory Authority (AERA) framework, which allows airports full cost recovery with assured margins.“Airlines operate on thin margins and depend on ancillary revenues to offset rising operating costs, including fuel, maintenance, airport charges, etc. Imposing a blanket ban on ancillary revenues undermines commercial flexibility and interferes with market-driven pricing mechanisms,” the FIA ​​was quoted as saying by PTI.The FIA ​​also said that although free seat selection may seem beneficial to passengers, the broader impact could be adverse, with higher fares likely to limit affordability and reduce consumer choice.It said this decision could run counter to the goal of passenger welfare by converting the optional, user-paid fee into a uniform fare increase for all passengers, which would adversely affect price-sensitive passengers.The industry body also flagged the absence of stakeholder consultation, saying the decision was introduced without prior engagement with the sector.The FIA ​​urged the Directorate General of Civil Aviation (DGCA) to withdraw the order, saying, “If implemented, this measure will set a precedent for excessive interference in ancillary pricing, leading to huge loss of revenue for airlines, as well as creating uncertainty for airlines about future regulatory hurdles.”On Wednesday, the ministry said it has directed the Directorate General of Civil Aviation (DGCA) to ensure that airlines provide at least 60 per cent of seats free for selection in each flight with a view to providing fair access to passengers.The move comes amid growing concerns over airlines charging high fees for add-on services, including seat selection. Typically, carriers charge between Rs 200 to Rs 2,100 for select seats, depending on factors such as row position and extra legroom.Meanwhile, sources said airlines have highlighted several operational pressures to the ministry, including rising jet fuel prices linked to the West Asia conflict, as cited by PTI.The situation has had a significant impact on flight operations to and from the region.

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