DGCA: No charges on 60% of seats... Why did airlines oppose the DGCA guidelines?

The government recently announced new guidelines regarding airlines. According to these guidelines, airlines were instructed not to levy extra charges on 60% of the seats on their flights. However, almost all airlines in the country are opposing this government directive. Meanwhile, the specter of rising airfares looms large. This is because airlines argue that if this rule is implemented, a significant portion of their revenue will be wiped out. Consequently, airlines may be compelled to hike airfares.

Under the government's new guidelines, a decision was made to offer 60% of flight seats free of charge (without any additional fees). However, the airlines have strongly opposed this government regulation. They contend that this will eliminate a major source of their revenue, potentially forcing them to raise ticket prices to offset the resulting financial losses.

The Federation of Indian Airlines—which includes IndiGo, Air India, and SpiceJet—has written a letter to the Civil Aviation Secretary regarding this matter. The letter expresses concerns regarding the new guidelines and calls for a halt to their implementation.

Airlines Explain the Rationale Behind Their Opposition
Regarding the government's new guidelines, the airlines argue that while this decision may appear beneficial to passengers on the surface, its actual implementation could lead to an increase in airfares, thereby making air travel more expensive for the common man. This impact would be particularly severe on frequent flyers, families, and budget travelers. Instead of benefiting the public, rising fares would ultimately result in a disadvantage for them. Furthermore, the airlines themselves would incur financial losses. Such guidelines could, therefore, lead to a rise in airfares in the days to come.

Government Interference in Pricing Decisions is Inappropriate
The Federation of Indian Airlines has also asserted that seat allocation and ticket pricing are commercial decisions falling within the airlines' purview, and government interference in such matters is inappropriate. They have also raised questions regarding the role of the Directorate General of Civil Aviation (DGCA). This is the reason why the introduction of these guidelines has created a rift between the government and the airlines.

The airlines claim that they were not properly consulted before this rule was implemented. They have demanded that the government withdraw this decision, as it could lead to increased government interference in the airlines' operations in the future.

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