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SpiceJet is back with discount sales, offering about 12.5 per cent of its inventory at lower prices, even as it awaits fund infusion from new investors, led by former director Ajay Singh.
On Wednesday, the no-frills airline announced it was offering 500,000 seats at a discount, in a three-day sale, with tickets starting at Rs 1,499. The discount tickets are for travel between February 15 and June 30.
Since November, the airline has been operating a truncated schedule, following reduction of its fleet to 34 planes. It operates about 230 flights a day, with inventory of about 30,000 seats a day (according to the current schedule).
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Chief Operating Officer Sanjiv Kapoor declined to comment on inventory data, terming it privileged information.
Responding to SpiceJet’s offer, IndiGo started selling tickets priced upwards of Rs 1,799. However, it didn’t disclose the number of seats available at lower prices or the booking validity. Prices of ticket on the Mumbai-Ahmedabad route start at Rs 1,799, while tickets to Goa, Nagpur, Indore and Bengaluru are priced upwards of Rs 2,355.
Earlier this month, other airlines had carried out promotional sales. Typically, the aviation segment records low demand in the fourth quarter.
SpiceJet has been losing market share due to flight cancellations, a truncated schedule and a short-term ban on bookings beyond 30 days. The airline’s market share fell from 17.3 per cent in October 2014 to 10.4 per cent in November.
Recently, it secured the Directorate General of Civil Aviation’s approval to sell tickets beyond March-end.
The airline is seeing a change at the helm, with founder and ex-director Ajay Singh set to take over the airline, which has been plagued by steep losses, high debt and overdue payments. Singh, along with other investors, plan to infuse about Rs 1,500 crore through the next three months and are awaiting regulatory approvals for the transaction.
“Ticket sales are an integral part of LCC (low-cost carrier) strategy. One has to be smart in the way it is done. It should help in increasing your revenues so that the RASK (revenue per available seat km) is more than the cost,” Singh told this paper recently.
"This sale offer coming from SpiceJet after a gap of few months shows the airline is back on track. Travel period offered under this sale covers summer vacation and is a good opportunity for people to plan their holidays in advance at very exciting rate. Such stimulating offers are not only good for airlines as they are able to fill more seats even in lean seasons but also for passengers and entire aviation and allied sectors like tourism and hospitality," said Vinay Gupta, Founder and Chief Executive Officer, TripFactory.com.
