Airborne: Indian reigns domestic skies

NEW DELHI: Even as its merger with Air India has entered the final lap, public sector carrier Indian has laid a strong foundation for formation of India’s largest airline by emerging as market leader in the domestic skies. Racing ahead of Jet Airways for three months in a row, the airline has re-established itself as a player to reckon with in the domestic market even as consolidation is queering the pitch. According to industry estimates, Indian’s market share in May was 21.7% compared to 20.8% in the case of Jet Airways.

The move comes as a good news for the giant airline formed by merger of Air India and Indian since rivals Kingfisher and Jet have consolidated their position by taking over, respectively, Air Deccan and Air Sahara. Leadership in the domestic market combined with established international operations would give the merged entity a strong footing in competing with the Jet-Sahara and Kingfisher-Deccan groupings, industry observers feel.
“The only reason behind increased market share of Indian is the improvement in distribution. Since September last year, Indian has beefed up its network. Earlier, tickets were available only with select agents, but now the airline is being marketed by a large number of agents,” said Amadeus India managing director Ankur Bhatia. “The increased market share of Indian would give it stronger position in the joint entity,” he added.

Even at the beginning of this year, the situation was different. Indian had only 17.1% market share compared to 23.7% in the case of Jet. However, aggressive marketing and lower prices helped the public sector carrier to step up its share to 21.9% in March compared to 21.7% in the case of Jet. The lead increased marginally in April with Indian holding on to 21.9% while Jet’s declined a tad lower to 20.9%. While both carriers lost market share to new players in May, Indian has managed to cling on to the lead.

With the merger coming into effect next month, the focus of the public sector player would be more on international routes. Domestic schedules would complement the international services, industry sources feel. Competition is expected to get intense once the Kingfisher-Deccan combine gets international rights and Jet manages to put Air Sahara on track under the JetLite brand.

The factors which contributed to the improved market share of Indian, include various marketing schemes such as premium-economy scheme. Operational efficiency of the airline also increased considerably during this period due to better fleet utilisation, a senior official of the airline said.

A Jet Airways spokesperson, when contacted, declined to comment on the market share of the airline. While Indian may have the largest market share in the domestic market, Kingfisher-Deccan and Jet-Sahara have a larger share than the mega airline that the Indian-Air India merger would result in. Air India has a negligible share in the domestic market as its focus is on international routes.