Small airlines make big jump in market share

New Delhi: Independent small carriers IndiGo, SpiceJet and GoAir have collectively been able to gain a greater share of the airline passenger market despite the consolidation and merger of the bigger airlines.
Figures released by the Directorate General of Civil Aviation (DGCA) for last year show that the consolidated share of the three independent carriers went up 10 percentage points to 22 per cent from 12 in 2006.
The smaller airlines appear to have gained at the expense of the bigger airlines that spent most of the year in mega-mergers and acquisitions.
Industry experts said while most full-service carriers concentrated on point-to-point services, the three smaller carriers put 25 to 30 per cent of their flights on hopper flights (that is, flights that touch down in more than two cities).
By doing so they were able to improve both passenger load factor and yield per seat.
SpiceJet, for instance, has indirect flights from Delhi to Coimbatore via Hyderabad.
IndiGo is choosing cities that have been under-served by other carriers and lack connections to other cities.
IndiGo’s strategy has also been to connect apparently unviable sectors, like the north-east, far in excess of the aviation dispersal route guidelines, which require airlines to ply some unviable routes to qualify to fly to big cities.
However, GoAir, which has not been able to expand significantly yet (it connects just 11 cities), has stressed lower fares to garner maximum load factors.
28/01/08 Anirban Chowdhury/Business Standard

To Read the News in full at Source, Click the Headline

Categories: Indian Aviation- In General Jan 2008, Regional Airlines Jan 2008