The Ministry of Civil Aviation (MoCA) has made amendments on the upper and lower limits of airline ticket pricing prescribed on domestic airfares. The lower fare limit applicable for economy seats of domestic flights will now apply to premium economy class seats, according to an order from the ministry dated October 5, 2020. On the other hand, the upper fare limits set for the economy class will not be applicable to premium economy seats. Only the full-service carrier Vistara has premium economy seats in its flights.
Seven-band system of airline ticket pricing
MoCA categorizes seven bands of ticket pricing based on flight duration. The first band is applicable to flights that fly for less than 40 minutes. The lower and upper airline ticket pricing limits of the first band are Rs. 2,000 and Rs. 6,000 respectively.
The second band is for the flights that fly for a duration of 40-60 minutes, which have a fare limit of between Rs. 2,500 and Rs. 7,500. The third band is for that of 60-90 minutes flights, and their applicable limits are between Rs. 3,000 and Rs. 9,000. The subsequent bands are for flight duration 90-120 minutes (fourth band), 120-150 minutes (fifth band), 150-180 minutes (sixth band), and 180-210 minutes (seventh band). They carry the lower and upper airline ticketing price limits of Rs. 3,500 to Rs. 10,000; Rs. 4,500 to Rs. 13,000; Rs. 5,500 to Rs. 15,700, and Rs. 6,500 to Rs. 18,600 respectively.
The seven-band airline ticket pricing system came into effect on May 21, 2020, and would last until November 24, 2020. The airlines will sell 40% of its tickets on a flight at airfares less than the midpoint between the lower and upper limit.
The underlying notion of the seven-band ticket pricing system is to ensure that the passengers are charged relatively, without crossing a certain limit amid this COVID-19 pandemic time. Domestic airlines have resumed services in the country on May 25, 2020.