Airfare hike coming? Airlines' association opposes 60% free seat directive, seeks removal of fare cap on 60%

The Federation of Indian Airlines (FIA) has written to the Secretary of the Ministry of Civil Aviation (MoCA), Sameer Sinha, expressing strong opposition to the directive mandating 60% free seat allocation on all flights. The FIA warned that the order would force airlines to increase airfares to recover lost revenue.

Indigo, Air India and SpiceJet have vehemently opposed the MoCA’s directive, describing it as counter-productive. The FIA highlighted that the financial impact on airlines will be significant, with losses ultimately borne by customers through higher ticket prices.

The FIA also raised concerns about what it called “regulatory overreach into commercial aspects of airline operations.” The federation questioned the authority of the Directorate General of Civil Aviation (DGCA) to regulate airfares and charges for unbundled services.

According to the FIA, the DGCA does not have the power to fix or cap fees for unbundled services, citing previous court rulings to support this position. The federation described the 60% free seat allocation order as a “counterproductive directive.”

From the passenger's perspective, the FIA noted that while free seat selection may seem beneficial initially, the overall outcome will be negative. Higher airfares will reduce consumer choice and affordability, especially affecting frequent flyers, families and budget travellers.

The FIA further argued that forced standardisation of seat allocation practices will limit service differentiation across airlines. This, they said, will reduce passengers’ ability to choose carriers based on personalised offerings.

The directive has sparked debate on the balance between consumer benefits and the commercial viability of airlines. The FIA’s letter to MoCA emphasises the need to consider the broader impact on the aviation sector and passengers.

In summary, the FIA’s opposition to the MoCA order highlights concerns over fare increases, regulatory limits, and reduced service variety. The federation urges a reconsideration of the directive in light of its potential effects on both airlines and passengers.