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Ashish Arya | 2012200 Sambran Kapil | 2012232 Saurabh Ajmera | 2012234 Shalini Poddar | 2012235 Shantanu Sherdekar | 2012236 Shreya Goel | 2012239
Aviation Sector in India – Present day scenario .
the state-owned operator of more than 120 airports .Political The Indian Cabinet approved foreign airline investment in Indian carriers in Sep-12 • Permitted 49% foreign direct investment in the airline sector The Airports Authority of India (AAI).moving into a critical phase in all three key functions: • • • airport operations airport development air navigation services 5 Year/20 Aircraft threshold for start-ups operating overseas likely to be abolished in 2013/14. • restriction discriminated against Indian carriers since it does not apply to foreign airlines .
Economic Aviation Hub India’s geographic location between Europe. Africa and Asia combined with its huge domestic market key building blocks to support the development of aviation hubs Absence of a transparent policy prevented the corporatisation of the sector kept many serious investors away from the market Frequent shifting of the goalposts many potential investors are reluctant to commit capital despite their confidence in the underlying growth potential of the market . the Middle East.
Social Focus on the Indian clientele which is mainly working class Customization of services to achieve customer satisfaction Consumer-friendly environment inside the aircraft .
upgrade projects at the two jewels in AAI’s crown. Construction utilised value engineering methods helped to contain programme costs welcomed by the industry as an important contribution to moderating increases in charges . Landmark year . have finally been completed. Chennai and Kolkata airports.Technology India’s satellite-based augmentation system. GAGAN. is expected to launch in 2014 Satellite-based navigation and flexible use of airspace reduce airline operating costs and carbon emissions through lower fuel consumption.
IndiGo Resources and Capabilities .
Indigo always lease aircrafts Get new fleet every three-four year Average age of fleet is two year one month (Singapore Airline – six years) Only Airbus aircrafts. unlike other LCC in India Low training and maintenance cost (outsourced to Airbus) Added a new plane every 6 weeks Least turnaround time. 20 minutes Required Navigation Performance (RNP) system Save 106 gallons per landing Low frills – more efficiency Avoided cutlery and food heating equipments First airline to introduce Hub and Spoke model in India Least flight to market ratio Indigo 66 aircrafts .
DGCA Jet SpiceJet Air Airways India Source: CAPA Research.Indian Domestic Market Share by Airline.40% Indigo Source: CAPA.90% 89. Mar-13 96. Mar-13 On-Time performance.20% 92.70% 87. Company Reports .
3%) Deliberate choice of under-served destinations Other such routes: Hyderabad-Chennai-Thiruvananthapuram-KochiDelhi or Srinagar-Delhi-Indore-Nagpur-Bangalore Large number of medical patients at Chennai Airport. so they gave a bigger budget for wheelchairs .Customer Service Best on-time performance in six metro airports Customers with only handbag can check-in-quickly without waiting Customers allowed to carry eatables Least passenger complaints and cancellation (only 0.
you make him a vice president of flight operations and expect him to manage 500 pilots. Then. after 30 years of service. this explains why the Indian airline industry has not produced enough leaders from the ranks” .“The way it is in our industry. a pilot is functionally just a pilot no matter how many years he has done.
One training program functional skills training aimed at specific roles like that of pilots. ticketing attendants. inflight crew. baggage handling coaching for customer service and soft skills leadership training at all levels Cost saving on Recruitment Poached 200-300 pilots from Kingfisher Saved on training cost Lean Management Air India has 250 employees per aircraft whereas Indigo has 96 .
JetLite Limited routes as compared to other airlines Competitive Rivalry.HIGH Operational efficiency is limitable Other airlines also concentrating on low costs Low customer loyalty Threat from New Entrants – MEDIUM Substitutes – HIGH Improving Railway travel Video conferencing No switching cost FDI & Government Regulations Mergers like Jet-Etihad LCC like SpiceJet expanding very fast Air Asia .Industry Analysis Porter’s 5 Force Model Supplier Bargaining Power – HIGH Rising fuel price Duopoly of Boeing and Airbus Maintenance staff from Airbus Weak Rupee Buyer Bargaining Power – LOW Many other options SpiceJet.
New Entrant – Air Asia .
AirAsia: New entrant in an industry making losses Good News for the industry Airlines are still focused on 'thick' routes connecting Mumbai. India’s market size is projected to multiply in the next ten years from the current 60 million to 450 million passengers. Indian carriers do not fit the low-cost bill Will shun major airports. which can actually be a big boost for the Airports Authority of India (AAI) Secondary airports will come up and smaller cities/towns will get air connectivity . Delhi and Bangalore Currently two-thirds of their revenues come from the big metros Less than 3% of Indians fly.
Vacuum due to Kingfisher's absence Passenger traffic will increase owing to lower fares. marketing and commercial strategy of India’s airlines. “There is a lack of innovation in pricing and strategy.g. and 20% seats are empty on most flights”.AirAsia: Advantage A large successful airline Cost per passenger kilometre excluding fuel is the lowest in the world at just $2 Will help break the status quo in pricing. Travellers between Bangalore and Kerala) . Will attract premium end bus and train travelers (e.
tale care of equity issues and accelerate regulatory approvals Airlines' struggle for profits will continue Profit-making carriers will buy out sick ones .Effect on other Airlines AirAsia-Tata association will unleash fare war.
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