Jet-Kingfisher deal scares many

New Delhi: The alliance between full service carriers Jet Airways and Kingfisher Airlines, commanding about 60 per cent of market share, is expected to hurt low-cost airlines, travel agents, private airport companies and air travellers.
Smaller low-cost carriers (LCCs) fear that they might be pushed out of premium slots for their flights by the JetLite and Kingfisher Red duo, while private airport companies feel that the combine could pressurise them to reduce airport charges, which they have resisted so far.
Experts also said that low-cost carriers may lose corporate travellers, who now constitute more than 5 per cent of their customer base, as they would get better frequent flier offers from the combine.
Travel agencies see the possibility of the alliance forcing them to strictly implement the zero commission rule introduced earlier. Consumers, of course, have to face the spectre of increased fares.
The alliance accounts for more than 80 per cent of the commission earned by travel agents from the domestic carriers.
For instance, travel portals such as Yatra's business might get squeezed.
With route rationalisation, it is likely that passengers will have to pay more.
Even airport infrastructure companies fear that the two might collectively bargain for lower airport service charges.
19/10/08 Anirban Chowdhury/Business Standard

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Categories: Jet Airways Oct 2008, Kingfisher Oct 2008