ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Narain GuptaSubscribe to Narain Gupta

Sensitivity of Traffic Demand to Fare Rationalisation

The Airport Metro Express Line and the implications of rationalisation of the price on its traffic and revenue are examined. The amel was incurring huge operational losses when the Delhi Metro Rail Corporation took over its operations, and was faced with the challenge of reviving it and making it operationally viable. The role played by price rationalisation to enhance capacity utilisation and revenue, which contributed to improving the amel’s “operating ratio,” is analysed. The strategy worked, and by April 2016 the amel was able to break even. This is an example of how a well-thought-out pricing strategy could improve the viability of a public utility.
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