The Hindu Business Line : <I>Easy money for airlines? </I>

Rush, rush, rush. One lakh tickets free. Any sector, any flight, for journeys made in such and such months. But they must be booked within the next few hours.

There have been four such `giveaways' by Air Deccan over the past five months, offering a total of 11 lakh seats.

On the eve of the New Year, the airline gifted its patrons 2 lakh free tickets. The all-routes, all-flights, all-days offer was for journeys made in (the slack months of) February and March 2007. But the tickets had to be booked immediately.

Many flights on many days, on some sectors are sure to have been snapped up, but it is hard to say whether the overall response was very good, or very poor. In any case, on Makar Sankranti, two weeks later, another 3 lakh free tickets were on the block, on pretty much the same terms as the earlier offer. These, too, were for travel in February or March.

The next offer, on April 12, was a blockbuster. Five lakh tickets up for grabs, for travel between July and October. And the follow-on offer of 1 lakh free tickets on May 4 was limited to travel during July and August.

The average collection on a free ticket (by way of charges and surcharges) is Rs 1,175. Assuming a 50 per cent response for the average offer size of 2.75 lakh, total collections would add up to Rs 16 crore. Since no refunds are allowed, all of this money would have been available to Air Deccan, within hours of the offer, free of cost and hassles, without any need for collateral.

The people who paid for the tickets will, of course, get to fly two months down the line. By then, the airline would have come up with another mega offer, and yet another. Others, too, are getting into this lucrative game. To celebrate its second birthday, Spice Jet is offering "2 lakh tickets for Rs 2 each when two of you fly together".

Sudhanshu Ranade

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