SpiceJet closes in on Air Deccan in pre-sold tickets

Mumbai: The country's first low cost carrier (LCC), Air Deccan, is facing stiff competition from newcomer SpiceJet, going by the revenues from the pre-selling of tickets by LCCs in the last fiscal. While Air Deccan raked in Rs 70 crore by pre-selling tickets in 2006-07, SpiceJet came a close second, and was able to garner nearly Rs 66.3 crore from selling tickets as much as three months in advance, according to industry estimates.
The Wadia-promoted GoAir would have garnered around Rs 50 crore through pre-selling of tickets during the period, 10% of their 2006 revenues of nearly Rs 500 crore. This, however, could not be confirmed with the company. Air Deccan's operations are confined largely to non-metro routes, one of the reasons for its poor show, despite being in the business for long. It hands out highly discounted fares and too many promotional discounts, too often, as compared to SpiceJet and GoAir, according to industry sources. Pre-selling of tickets by low cost carriers (LCCs), a practice followed worldwide, has not only increased the passenger load factor for these airlines, but also generated the much-needed cash flow.
10/04/07 Shaheen Mansuri/Financial Express

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Categories: Air Deccan Apr 2007, SpiceJet Apr 2007