The Hindu Business Line : Low-cost airlines flying high

Both the airlines have seen a steady growth in passenger numbers, while the original people’s airline — Air Deccan — has lost steam during the first 11 months of this year.

In 2006, Jet Airways alone carried more passengers in the Indian skies (100.28 lakh) than the combined passenger carriage of the four low-cost airlines (Deccan, Spice, IndiGo and GoAir).

That year, the four airlines together carried 94.08 lakh passengers.

A general trend

In many ways, this trend reflects what the Montreal-based International Civil Aviation Organisation points to.

“Passengers carried on scheduled air services increased by around 0.8 per cent in 2008 to 2.29 billion. This average growth was shared unequally between IATA airline members and other types of carriers, notably Low-Cost Carriers,” the international body said in a recent statement.

When it comes to the performance of low-cost airlines during these three years, IndiGo’s performance outpaced that of SpiceJet’s though it started operations in August 2006. In the same year, SpiceJet had carried close to 12 lakh passengers. In three months of 2006, Indigo carried 4.12 lakh passengers.

Market consolidation

Several reasons are being cited for passenger preference for low-cost airlines.

These include the fact that the days of low fares on full-service airlines became a thing of the past after the consolidation that the industry witnessed with Jet Airways buying out Air Sahara, which was quickly followed by the merger of Air India with Indian.

Then, Kingfisher Airlines acquired Air Deccan, leading to further consolidation in the market.

Besides, the global rise in prices of aviation turbine fuel meant that full-service airlines increased fares further, making low-cost carriers more attractive.