| Fares dip as airlines look to low-cost model | |
| Mihir Mishra / New Delhi October 17, 2009, 1:04 IST | |
Number of low-cost seats up by an average 50% across industry
Kingfisher Airlines and Jet Airways have converted around half their capacity into low-cost services. This has contributed to bringing down the average fares of airlines as a whole by about 30 per cent, from about Rs 4,000 in September last year to Rs 2,700 currently, a key reason why the domestic passenger market is looking up after months of decline.
“The number of low-cost seats in the system has increased by over 50 per cent this year compared with the same period last year,” said Mohit Shrivastava, head of online sales at Makemytrip.com, an online tickets and hotel booking portal.
Among the full service carriers, the government carrier, Air India, plans to launch a low-cost model in the domestic skies. It already has a low-cost airline called Air India Express which operates on international routes.
“In Kingfisher Airlines, the number of low-cost seats in the system has increased by 50 per cent. The total number of low-cost seats available has reached to around 70 per cent of the total. This figure was 45 per cent during the same period last year,” said a source in the airline.
The airline has converted some full services into LCCs, shifting these to Kingfisher Red (earlier called
Air Deccan, the country’s first LCC) from Kingfisher Airlines (the full service operations).
Jet Airways, the oldest private airline in India, has also increased the number of low-cost seats in the system by around 50 per cent. This does not include the seats offered by JetLite, which could take the number of total low-cost seats being offered to around 65 per cent. Jet acquired Air Sahara in April 2007 and renamed it JetLite.
“We have increased the number of low-cost seats in the system by around 50 per cent. We launched JetKonnect in June this year and that contributed to most of it,” said a source in the airline.
Apart from full service carriers shifting capacity from full service to LCC operations, the LCCs are also increasing capacity in anticipation of better times. Indigo has increased the total number of seats by around 40 per cent in the past year.
During the same period last year, they had a fleet of 16 aircraft, which has now been increased to 22. SpiceJet has also increased the number of seats, by 53 per cent, not by increasing the number of aircraft but by raising the number of flights.
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