Allied business takes off as airlines see red

New Delhi: Domestic carriers such as Kingfisher Airlines, Jet Airways and SpiceJet are banking on ancillary activities like crew and pilot training, besides inflight sales, to spruce up revenue generation. With profits from their core business elusive, these carriers are planning to increase their revenue share from these alternatives. Low-cost carriers (LCCs) are also levying additional charge for advance seat booking and e-booking.
Talking about its venture, which will be an additional revenue stream for the airline, Kingfisher Airlines executive vice-president Rajesh Verma said, “Training front-office staff is part of our aim to establish it as sub-vertical of our airline business. By training 6,000-8,000 cabin crew and other front-office professionals, we would be generating revenue of about Rs 60 to 80 crore in the first year. Owing to high investment, this venture will break-even in two years.
Jet Airways, is planning to provide ‘type rating’ to pilots of other airlines. The company is believed to have sought permission from Directorate General of Civil Aviation (DGCA) for the same.
“We had to find new revenue streams and thought a consumer on a long haul flight won’t mind paying to get a seat of his choice,” says SpiceJet V-P (marketing) Kamal Hingorani.
“Airlines in India and globally charge these sorts of transaction fees to help defray the costs of providing the services. Though it is also an ancillary source of revenue,” says IndiGo CEO Bruce Ashby.
02/05/08 Vishakha Talreja & Nirbhay Kumar/Economic Times

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Categories: Indian Aviation- In General May 2008