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As per a report in Business Standard, Air Deccan is planning to offer ultra low rates for tickets from Delhi to Mumbai. The lowest prices are proposed to be in the region of Rs. 500/-

This could be the mother of all price wars. Deccan Aviation, India’s first no-frills carrier, will offer tickets for as little as Rs 500 on the Delhi-Mumbai route once it starts flying on this sector later in the month.

“We will be offering various price bands and the lowest ticket price in this sector will be Rs 500,� said GR Gopinath, deputy chairman, Deccan Aviation, speaking at a two-day symposium on low-cost airlines in New Delhi today.

The Delhi-Mumbai operations are expected to start between July 16 and July 23.

At Rs 500, a Delhi-Mumbai ticket would be less than 10 per cent of the existing economy airfare of Rs 6,445 and very close to the Rs 421 second-class Delhi-Mumbai railway ticket.

In other sectors, Air Deccan’s services are about 50 per cent lower than the normal full-service operator, though in no sector does it offer tickets at less than Rs 990.

According to aviation experts, since Air Deccan will offer only 25 per cent of the seats for Rs 500 and scale up the price of the remaining seats, the average per seat realisation will come to around 50 per cent of the realisation for a full-service airline. The world over, low cost carriers operate at about half the costs of a full-service airline.

More: business-standard.com