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Dubai: If you think low-cost carriers (LCC), or budget airlines, are the answer to rising airfares, you may be right. However, if you make a last minute booking, your seat may cost as much as when flying with a full-service carrier.
"Fares rise as the date of departure nears, and seats fill up," Fawaz Al Sidri, communications manager of Jazeera Airways, told Gulf News.
Why would passengers still choose to fly with budget airlines? Availability seems to be the most obvious reason.
However, Al Sidri says that there are more reasons such as owning newer planes. "We also fly out of Terminal 1 in Dubai, and cater to two classes of markets," he says.
Jazeera Airways is based in Kuwait, and has been flying from Dubai as a secondary hub since February 2007.
Al Sidri adds that the model of budget airlines is designed to work in such a way that passengers benefit more if bookings are made early.
Sharjah-based Air Arabia, the region's first budget airline, adopts a similar scheme. Housam Raydan, corporate communications manager of Air Arabia, says the earlier a customer books his/her ticket, the lower the price due to availability. "Such pricing allows Air Arabia to offer extremely competitive fares, especially for those who book early," he said in a statement.
A last-minute flight booked with Air Arabia to Beirut in July cost about Dh2,079, but when booked two months early for September 1, it is priced at Dh1,319. Flying with Emirates airline, a seat booked for Beirut in July cost Dh2,850, but when booked two months early for September 1, it is priced at Dh2,010. Conclusively, full-service airlines are also subject to lower rates when booked early.
Raydan adds that this "supply-demand model has been embraced globally, and has proved central to the success of LCCs worldwide, and here in the region."
However, time is not the only factor. Flying during an off-peak season also has its effect on prices.
"While it is true that there are particular benefits to booking early, our prices remain competitive even for late bookings. Ultimately, prices do not depend upon the time of booking but, rather, seat availability," he adds.
Jayram Iyar, general manager of Sharaf Travel, agrees says that most carriers will have to face the brunt of the increase in fuel prices and part of the cost will be passed on to the passengers. "However, passengers who need to travel will do so, whatever the cost," said Iyar.
Budget airlines, according to him, have a different model from full-service carriers. "They might not change the fares but they alter their inventory," by not offering the full range of services, to balance the increase in fuel prices, Iyar says.
Hussain Tehrani, general manager of Al Rais Travel, says, "LCCs save on food and routing to low-interest airports. So if the price of fuel keeps increasing, it's going to hit LCCs quite hard."
But he believe they have their own customers. "Even if they are 20 per cent cheaper, people will still travel with them," he adds.
Tough times
Iyar says that the airline industry is going through a tough time and some airlines will cut down their non-profitable routes.
He expects business travel to slow down at the moment, but pick up again after the holidays.
Leisure travel will face the impact of the prices with people postponing vacations till next year or spending their holidays in the region, Iyar said.
Tehrani says that the message is that people are accepting the prices now but they have to be closely watched for further increases in the next few months.
"If it continues, people have to think twice about how to spend money on travelling," Tehrani says.
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