The Hindu Business Line : As the crow flies

Even a crow knows that the most efficient way to get from one point to another is the straight flight path. Yet when people fly across the world or within their own country, they find most of the time that their airlines route them first to a hub airport and only then to the eventual destination. Often it is because airlines do not either have the rights to fly direct or because they believe passenger loads are not enough, given the kind of aircraft they have, to make the direct route viable. People who fly to and from lesser cities have to take the long route, the connecting flight. Why lesser cities? Even State capitals are badly connected to one another. If you want to fly from Raipur to Hyderabad, the chances are that you will need to fly all the way to Mumbai before you can retrace your way to Begumpet airport. And if you do not live in or close to the top 50 towns, you may not even have an airport to fly from.

The rapid growth in passenger traffic in the domestic skies over the past three years has been unprecedented. Helping boost the growth in traffic has been the dramatic reduction in fares, which in turn was induced by intense competition among the expanded set of private and public sector airlines. Deeply discounted fares, even if they did rouse the citizenry in the metros to fly en masse, do not produce great looking bottom-lines. In fact, barely one or two carriers do make profit. The bustle too was principally confined to six large cities: three out of every four passengers who flew last year either travelled to or from one of the six. The latest policy to promote a new genre of regional airlines may go some way towards addressing the relative neglect of the lesser cities.

The Government has provided financial inducements to those who operate small jet aircraft or turbo-props by lowering charges for them at airports and the sales tax on fuel, which constitute a third of the operating costs of an airline. Yet the question of viability of such small operations will remain. An aircraft needs two pilots, regardless of whether it carries 48 passengers, as in a turbo-prop, or 180 in a stretched Boeing 737 jet. The fare charged will need to cover their wages. Unsurprisingly, even today, fares on smaller aircraft are generally higher than those on the larger jet aircraft when they fly the same route. Given the need to set relatively high fares, attracting fliers on these regional routes will be a challenge for the new regional airlines. Flight safety issues will present an even greater challenge for the civil aviation authorities. Small aircraft operating to airports without the best facilities, and small airline budgets are not necessarily conditions that make for high safety.

Related Stories:
Bird Air keen to make regional foray
Govt unveils regional airlines concept to boost connectivity