When it comes to making money, the airlines which know the most about it in India is the no-frills carriers. The business is straightforward, you pay for a seat on the plane, which could be very cheap, and then you pay for everything else. Given the market-share of LCCs in India, which is way over 50% at the moment, 68% as of September 2018 to be precise, it then should not surprise us that things change at a speedy clip.
Back in the day, in 2013, airlines were allowed for the first time to unbundle services. That meant everything apart from the right to board the plane and be transported from your origin to destination was now chargeable. Back in the day, IndiGo was offering up to 72% of the seats for pre-assignment at a charge, even charging for the Middle Seat. Eventually, IndiGo retracted. The rulebook was clear; you could only sell 25% of the seats on the plane as preferential.
However, under the current guidelines applicable to airlines, here is what is permitted, (bolding mine)
The airfares so established by the airlines also include charges for some of the services rendered by them. On the basis of various feedback received, it is felt that many a times these services provided by the airlines may not be required by the passengers while travelling. Considering the fact that unbundling of services and charges thereto has the potential to make basic fare more affordable and provides consumer an option of paying for the services which he/she wishes to avail, it has been decided by the Government to allow following services to be unbundled and charged separately on opt-in basis:
(i) Preferential seating
(ii) Meal/snack/drink charges (except drinking water)
(iii) Charges for using airline lounges
(iv) Check-in baggage charges (above 15 kgs. of free check-in baggage allowance. Between 15-20 kgs of checked-in baggage, the charge per kg shall not be more than INR 100). However, airlines are allowed to offer “no check-in baggage/ hand baggage only” fare scheme subject to the condition that the penalty to be imposed on a passenger, who avails such schemes but turns up with baggage for check-in at airline counter, cannot exceed the amount of incentive offered compared to lowest fare.
(v) Sports equipment charges
(vi) Musical instrument carriage 2
(vii) Fee for special declaration of valuable baggage (allow for higher unit on carrier liability)
There is no definition, however, about what is preferential seating. So, till a while back, airlines used to offer economy seats ahead of the emergency exit as preferred seating, and behind the emergency exit, it was a lot of windows and aisles. But there seems to be a change in this policy right after Diwali, and it was not communicated to passengers.
Here is how SpiceJet defines Premium Seats.
It turns out, for any seat on SpiceJet, now you need to pay anywhere between INR 99 to INR 1,000 for the seats. Here is the new pre-assignment seat charge.
And IndiGo has also now assigned a price for each seat to check-in around the same time. Here is the newly published charges chart.
Why create another level of friction you may ask and not allow people to web check-in earlier for free? It is simple — revenue maximisation. These airlines are hoping many people will bite on this and would want to shell another INR 99-200 at the minimum rather than stand in those long queues at the airport.
Once you arrive at the airport, seat selection is free, so you can still get an open seat assigned via the kiosk or at the airport counter. This is worse off than even Jet Airways paid seat selection which makes everything open for all at the 6-hour marker.
Airlines will continue to find newer ways to get money out of your pocket. After all, if you are being sold a seat below the operational cost of the aircraft, you need to be ready to pay for other stuff so that the airline can recoup their costs or eke out a profit. That is the nature of the business.
What do you think about the newest move by IndiGo and SpiceJet for seat selection charges?