The tried and tested strategy of offering rock-bottom fares has been AirAsia’s success mantra. But given that India does not allow low-cost terminals like Malaysia or the UK and the fuel tax structure does not favour widebodied aircraft such as the A320s that AirAsia plans to fly, it remains to be seen how the Malaysian airline will replicate its global strategy in India.
Despite Mumbai and Delhi being the most lucrative routes for domestic airline, Air Asia’s Indian airline is likely to avoid these routes and instead focus on tapping new potential fliers. The airline will target southern metros and connect Tier-II and -III cities where cost of operations are low so that it can continue with its strategy of competitive pricing. Air Asia’s Toney Fernandes plans to expand services to Delhi and Mumbai only once those airports have separate terminals for low-cost carriers with lower charges.
07/03/13 First Post.com
