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Passengers travelling within the country prefer low cost carriers or budget airlines over regular airlines and Air India. This was evident in the gradual increase in market share of low cost airlines to 41.1 per cent during January 2011 against 34.3 per cent in the corresponding period two years ago and 39.1 per cent a year ago.
The total domestic passenger travel during January was 9.45 lakh against 7.94 lakh in the same month last year, an increase of 19 per cent.
The Airports Authority of India (AAI) considers Air Deccan, Kingfisher Red, Spicejet, Go Air, Jet Konnect and Indigo Airlines as low cost airlines. Two years ago, the regular airlines had nearly 50 per cent market share but this declined to 45 per cent in January this year.
Regular airlines hit
According to a recent data released by AAI, the market share of regular airlines has dropped to 45 per cent in January 2011 from 50.5 per cent two years ago. “Airlines like Indigo and Kingfisher have brought in a huge change in the passenger industry. With on time schedule, these airlines have made a big dent into the regular airlines,” said Mr Sudhakar Reddy, National President, Air Passengers Association of India.
According to AAI, the share of private airlines in aircraft movement, passenger and freight on the domestic sector was at 83.4 per cent, 86.1 per cent and 83.7 per cent, respectively, during January 2011. The overall share of passengers in low cost airlines increased to 41.1 per cent in January against 39.1 per cent in January 2010.
Industry sources said low cost airlines have become an alternative to road travel for short distances – say between Chennai and Tiruchi or Madurai. Passengers have accepted the concept of ‘no frills' in these low cost airlines.
Impressive developments
According to a research on “Indian Aerospace Industry Analysis” by Market Publishers of Cyprus, India's low cost carriers have registered the most impressive market developments during the past few years and are further expected to orchestrate 34.3 per cent CAGR growth by 2013, which is one of the highest in the world.
The research identified that, these low cost carriers have now become a norm for domestic passengers in the country as well. They have created their own niche in the Indian market and are giving tough competition to full service carriers.
Fleet expansion
The study also revealed that airlines will require over 1,000 aircraft by 2020, which will make India one of the biggest markets for global OEM's and also fuel domestic MRO sector growth. Mid-term aircraft fleets expansion is expected to exert strain on operational and safety agencies. This can be perceived as an excellent market opportunity for airport surveillance equipments market and ground safety equipments sector.
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