Foreign carriers take a hard look at Indian ops

Mumbai: Slipping international traffic is pushing foreign carriers operating out of India to downsize capacity and drop loss-making routes.
Till some time back, India was amongst the few countries around the world whose international traffic was growing. Now, with the number of passengers into and out of India dwindling, many international airlines are either suspending routes or reducing frequencies to match supply with the current demand. As per Airports Authority of India (AAI) data, growth in international traffic in April-December 2008 was 8.6%, half of what it was the year before. Experts believe the later part of this period may have seen negative growth.
"That could be reason that most of the overseas airlines have been cutting flights to and from some Indian cities recently," said an aviation analyst, who did not want to be named.
Air France has suspended services on Chennai-Paris route while its sister airline KLM has pulled off flights between Amsterdam and Hyderabad. A statement by Air France-KLM, the holding company of the two airlines, said the move was "in lieu of the financial results of this route and the market developments."
Austrian Airlines shut services out of Mumbai from February 1, and is now only operating from Delhi. Nippon Airlines and Japan Airlines too have announced reduction of frequency out of Mumbai.
British Airways will withdraw flights on the Kolkata-London sector from March 28.
German airline Lufthansa has not yet announced any routes suspensions, but it has shuttered four offices -- in Kolkata, Bangalore, Chennai and Hyderabad.
This, industry observers feel, may be a precursor to reducing frequencies to these cities.
Singapore Airlines recently announced an 11% cut in its global capacity, which will also see 17 of its aircraft -- mostly Boeing 747s -- being phased out. As part of the capacity rationalisation programme, the airline has announced reduced frequencies to Mumbai, Delhi, Hyderabad and Ahmedabad.
An analyst with an international research firm feels India, like some other East Asian countries, is a potential market as none of the airlines have pulled out completely.
In a market where most sectors are seeing fewer passengers, Gulf routes are doing well and airlines here have been adding capacity. Emirates Airlines' strategy -- announced a few days ago - will see the airline adding 14% capacity globally.
25/02/09 Archana Shukla/Daily News & Analysis

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Categories: Foreign Feb 2009, Indian Aviation- In General Feb 2009