New Delhi, Feb 4
The Competition Commission of India on Wednesday ordered a detailed investigation against IndiGo over allegations of unfair business practices, more than two months after the airline cancelled thousands of flights due to major operational problems.
IndiGo currently dominates India's domestic aviation market with over 65 per cent share. In December, the Air India Group increased its market share to 29.6 per cent, while Akasa Air's share rose to 5.2 per cent.
Both airlines had lower shares in November. SpiceJet also saw an improvement, with its market share rising to 4.3 per cent in December from 3.7 per cent a month earlier. State-run Alliance Air's share remained unchanged at 0.4 per cent.
In its 16-page order, the CCI said IndiGo's large-scale flight cancellations amounted to withholding services from the market. The watchdog noted that a significant portion of the airline's scheduled capacity was suddenly withdrawn, which may have created an artificial shortage of flights.
This, it said, limited consumers' access to air travel during the busy holiday season.
IndiGo faced severe disruptions in early December, forcing aviation regulator Directorate General of Civil Aviation (DGCA) to cut the airline's winter schedule by 10 per cent until February 10.
More than 10.4 lakh passengers were affected by flight cancellations in December, and over 93 per cent of those impacted were IndiGo customers.
Thousands of travellers were stranded at airports across the country as the crisis unfolded. On the worst day, December 5, the airline cancelled more than 1,600 out of its 2,300-plus daily flights.
During the peak disruption period between December 3 and December 5, a total of 2,507 IndiGo flights were cancelled, while another 1,852 flights were delayed.
The sudden shortage of flights led to a sharp rise in ticket prices across other airlines as passengers rushed to book alternative travel options. The government had to step in by imposing distance-based caps on airfares to control the surge.
Following complaints from various quarters, the CCI took note of the matter on December 18 and began examining whether IndiGo had abused its dominant position in the market.
The airline has already faced regulatory action, with the DGCA imposing penalties of Rs 22.20 crore and issuing warnings to the company's senior management.
In its latest order, the CCI said passengers who had booked IndiGo flights were left with no real choice but to accept last-minute cancellations. It added that many were forced to arrange alternative travel at much higher prices.
Given IndiGo's dominant market position, the watchdog said consumers lacked meaningful alternatives, which may amount to a violation of the Competition Act.
The CCI has directed its investigation arm to complete the probe within 90 days.
- IANS
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