The Air India Group announced a significant revision to its fuel surcharge structure after the latest costs of aviation turbine fuel were raised by 25% domestically and a whopping 115% internationally.
The revised charges will make Air India’s airfares costlier by up to Rs899 for domestic routes and $280 for international routes.
Revision Follows IndiGo and ATF Price Surge
Air India’s revision comes a week after IndiGo also increased its fuel surcharge, following the ATF price increase announced by Indian oil marketing companies on April 1. The new charges reflect a historic surge in global prices, which have nearly doubled over the past month due to escalating geopolitical tensions in West Asia.
The revised surcharge introduces a distance-based grid for domestic travel and a regional-tier system for international flights, substantially increasing the cost of air travel effective Wednesday, April 8. For domestic flights, the airline has transitioned from a flat fee of Rs399 to a distance-based model to align with government caps on fuel price hikes. The new surcharges range from Rs299 for up to 500km to Rs899 for above 2,000km. The carrier claimed that the surcharge has been contained due to the Indian government’s decision to cap the ATF price hike to 25%.
Steeper Increase for International Travelers
As the global average jet fuel price rose to $195 per barrel, up nearly 100%, international travelers will face a steeper increase. Air India stated that it has implemented a higher surcharge on international routes due to the absence of mitigations like the domestic price caps. From Wednesday, travelers will have to pay an extra amount ranging from $24 for SAARC countries to $130 for Africa. Similarly, routes to Europe will see a $205 hike, whereas North America and Australia routes will charge $280 from Friday.
The decision comes as the aviation industry grapples with an unprecedented spike in operating costs. Fuel typically accounts for around 40% of an airline's total expenditure and the rising ATF prices have forced the airlines to pass the brunt on to the passengers. In India, ATF prices have hit a record high of over Rs2 lakh per kilolitre.
In an official statement, Air India stated that the revised surcharges apply only to new bookings. Tickets issued prior to the effective dates will not be impacted unless the itinerary is modified. Revisions for routes to Japan, South Korea, and Hong Kong are expected to be announced following regulatory approval.
On April 1, IndiGo also implemented its own distance-based surcharge, with domestic fees going up to Rs900, which was earlier flat Rs425. The international routes saw the biggest hike, ranging from Rs900 for destinations in the Indian subcontinent to Rs10,000 for routes to the UK and Europe. The airline had claimed that it passed on a relatively smaller amount to customers, keeping in mind the consequential burden on them.
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