Budget airlines to touch down on GDS track

Bangalore: As budget airlines look for better yield management and reach, they are going against one of the tenets of low-cost flying - keeping off the global distribution system (GDS).
Over the past one and a half years, several no-frills airlines around the world have got onto the GDS network to give better accessibility to flyers.
In India, too, the largest budget airline, Deccan, recently tied up with GDS majors like Abacus Distribution System and Amadeus to sell its inventory (tickets).
Are these airlines grossly defying the business model of low cost aviation?
Nihir Pandya, manager, airlines marketing and sales, Abacus Distribution System India Ltd, doesn’t think so.
Pandya says that while it (GDS) adds to a budget airline’s cost, it also pushes up revenues by its extending reach.
That, says Amadeus managing director Ankur Bhatia, will result in optimisation of aircraft utilisation and helps in improving a budget airline’s yield. Thus, higher yield earned by airlines offsets additional cost that they bear for being on the GDS network.
19/03/08 Praveena Sharma/DNA Money/Sify

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Categories: Low Cost General Mar 2008