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CCI closes case against airlines on fare spike during 2016 Jat stir; finds no price parallelism

The fair trade regulator began looking into the matter after receiving a complaint that air fares on certain routes had skyrocketed during the Jat agitation in February 2016.

Published: 08th June 2021 08:02 PM  |   Last Updated: 08th June 2021 08:02 PM   |  A+A-

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For representational purpose. (Photo | PTI)

By PTI

NEW DELHI: After a detailed probe that also analysed data of 338 flights, the Competition Commission has closed a case of alleged cartelisation among four Indian carriers with respect to air ticket prices on certain routes during the Jat agitation in 2016.

The fair trade regulator began looking into the matter after receiving a complaint that air fares on certain routes had skyrocketed during the Jat agitation in February 2016.

Subsequently, a detailed investigation was carried out by the watchdog's Director General (DG) against IndiGo, SpiceJet, Air India and Go Air (now rebranded as Go First).

Jet Airways was excluded from the investigation purview as it had shuttered operations in April 2019 and went into insolvency proceedings.

"There is no evidence on record to establish cartel amongst the airlines during the period of Jat agitation, i.e.18th to 23rd February 2016 and having examined the material on record, the Commission finds no reason to differ with the findings recorded by the DG," Competition Commission of India (CCI) said in a 15-page order.

As per the DG's investigation report, the analysis of the information submitted by the four airlines did not reveal any uniformity or specific trend with respect to opening of buckets by them.

"It is noticed from the DG report that the DG analysed aviation data of 338 flights to detect any pattern in pricing indicative of price parallelism and collusive behaviour.

"The investigation analysed the total revenue generated by each of the airline, average price per ticket, the dates of booking, the number of buckets used and the number of seats sold/ unsold for six sectors viz.

Delhi-Amritsar, Amritsar-Delhi, Delhi-Jaipur, Jaipur-Delhi, Delhi-Chandigarh, and Chandigarh-Delhi during the relevant period," the order said.

During the period, it was noticed that all the six sectors witnessed high demand for air tickets due to onset of Jat agitation.

"Though, all the four airlines sold their tickets at higher fare buckets for scheduled and additional flights for the aforesaid six sectors, the investigation did not reveal any price parallelism or identical pricing of tickets by the airlines for any of the six sectors," the order said.

According to CCI, the probe also examined the e-mails of the key personnel of various airlines in order to ascertain meeting of mind, if any, among the competitors for any form of collusive behaviour or agreement to raise ticket prices during the period of the agitation.

"However, the investigation did not reveal any incriminating emails or any form of electronic communication which may establish exchange of information or collusive behaviour among the airlines.

"Thus, there is no evidence on record to suggest any concerted action or communication between the airlines to fix ticket prices or otherwise in coordinating supplies," the order, dated June 3, said.

CCI said there are different types of custom-made algorithms suited for the needs of a particular airline and that the final call for inventory allocation is taken by the respective route analysts of different airlines.

While passing the order, the regulator also said the airlines had operated additional flights during the relevant period following a directive from DGCA.



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