Regulator bars airlines from skipping unprofitable routes

New Delhi: India’s aviation regulator Directorate General of Civil Aviation (DGCA) has banned national airlines trading seat-miles with so-called regional carriers to meet regulatory requirements, mandating that all airlines fly unprofitable routes to poorly connected cities and towns as part of their operating licences.
Not complying with the requirement can potentially lead to an airline’s operating licence being scrapped.
This requirement, contained in what are called route dispersal guidelines, divide domestic routes into three categories. Category I represents the profitable routes, including major cities such as Mumbai, New Delhi, Bangalore, Hyderabad, Kolkata and Chennai. Category II includes the north-eastern region, Jammu and Kashmir and Lakshadweep, while category III represents places such as Coimbatore, Kochi and Pune. Airlines have to deploy on category II routes at least 10% of their flight capacity deployed on the most profitable routes, and at least half on category III routes.
Most national airlines prefer flying the metro routes, which offer better passenger traffic and yields. But regional airlines operate on licences that allow them to use as their hub a metropolitan city—defined as New Delhi, Mumbai, Kolkata and Chennai—and connect to smaller cities and towns. They cannot fly between two metros.
So far, domestic airlines could opt to buy an equal number of seats from regional or other carriers that have operations on unprofitable routes to comply with existing norms. The airlines selling seat-miles would have in excess of the minimum required in the route dispersal guidelines. For instance, Wadia Group’s GoAirlines (India) Pvt. Ltd, which runs low-fare carrierGoAir, bought seats from Gurgaon-based MDLR Airlines Pvt. Ltd last year when it was unable to meet the route dispersal requirements.
“What was happening was they were purchasing (seats) from airlines like MDLR which anyway fly regional routes. This was affecting connectivity,” said a senior government official, who asked not to be named. The official added that domestic airline firms such as Kingfisher Airlines Ltd and Jet Airways (India) Ltd, however, can trade among themselves to meet these requirements.
“Since scheduled regional airlines do not fall under the purview of route dispersal guidelines, they shall not trade off their ASKM (available seat kilometres) on Category II, IIA and III routes with scheduled domestic airlines,” DGCA, as the regulator is referred to in short, said in a note this month.
24/04/09 Tarun Shukla/Livemint

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Categories: Indian Aviation- In General Apr 2009, Regional Airlines Apr 2009