Alliance Air Introduces Fixed Fare Scheme to Combat Price Volatility

Government-owned regional carrier Alliance Air has launched a novel pricing initiative aimed at eliminating the uncertainty of fluctuating ticket prices. The scheme, launched on Monday by Civil Aviation Minister Rammohan Naidu Kinjarapu, offers passengers a single, fixed fare that remains constant regardless of when they book their tickets.

The initiative, running on a pilot basis from October 13 through December 31, 2025, addresses a persistent pain point in Indian aviation. Unlike the dynamic pricing model that dominates the industry, where ticket costs vary in real time based on demand and competition, this scheme guarantees the same price whether passengers book weeks in advance or on the day of departure.

Civil Aviation Secretary Samir Kumar Sinha, Alliance Air Chairman Amit Kumar, and airline CEO Rajarshi Sen attended the launch event. The pilot program will cover select routes, allowing authorities to assess operational viability and gauge passenger response before potential expansion.

Minister Naidu emphasized that the scheme aligns with the government's UDAN initiative, which aims to make air travel accessible to middle-class and lower-middle-class citizens. He described Alliance Air as the backbone of regional air connectivity, noting that it connects tier-2 and tier-3 cities to the national aviation network.

The minister highlighted his ministry's focus on making aviation more people-oriented since he took charge. He pointed to the recent introduction of UDAN Yatri Cafes at airports, which offer tea for ten rupees, coffee for twenty rupees, and snacks for twenty rupees, as part of efforts to make air travel more affordable and dignified.

India's aviation market has long relied on dynamic pricing for revenue management. While effective for airlines, this system often frustrates passengers with unpredictable last-minute fares. The new fixed-fare system aims to bring transparency and stability to ticket pricing, particularly benefiting travelers from smaller towns who may be first-time flyers.

According to August 2025 data from the Directorate General of Civil Aviation, Alliance Air carried 37,000 passengers during the reporting month, representing 0.3 percent of the 1.29 crore passengers flown by all domestic carriers. The airline recorded a load factor of 68.7 percent, though its on-time performance stood at 55 percent, the lowest among five major airlines including IndiGo, Akasa, Air India Group, and SpiceJet.

Fleet tracking data from Planespotter shows that as of October 11, Alliance Air had eight aircraft in operation and twelve on ground from its total fleet of twenty aircraft.

The minister described the initiative as exemplifying a vision that goes beyond profitability to focus on public service. He stressed that the static fare system eliminates the stress associated with fluctuating airfares, ensuring cost predictability even for last-minute bookings.

The scheme is expected to particularly benefit passengers traveling to and from tier-2 and tier-3 cities, where Alliance Air primarily operates short and medium-route flights. By removing price uncertainty, the airline hopes to encourage more people from smaller towns to choose air travel over other modes of transportation.

The three-month pilot period will be crucial in determining whether the fixed-fare model can be sustained operationally while meeting passenger demand and expectations in India's competitive aviation market.