Airlines bet big on non-metros
Trunk routes such as Delhi-Mumbai and Delhi-Bangalore are no longer generating profits to the airline companies. The reason is that the airlines have increased the number of flights, which are not flying full capacity.
By ET Bureau |
NEW DELHI: Trunk routes such as Delhi-Mumbai and Delhi-Bangalore are no longer generating profits to the airline companies. The reason is that the airlines have increased the number of flights, which are not flying full capacity.
Also, airline companies are emphasising on the non-metro routes as the growth there is more than the metro routes.
For the cash strapped airlines, smaller cities and towns are bringing in huge passengers loads even as the troubled aviation sector is looking for new ways to fight rising costs and sustain operations.
According to the latest data released by Airports Authority of India (AAI), while the traffic growth in metros has been in the range of 30-40% in 2007-08, it has more than doubled in the case of smaller towns such as Bhubaneshwar, Jaipur, Ranchi and Raipur , the growth has been in the region of 60-100%.
Airlines are concentrating on the regional routes to keep their operating costs low and increase passenger load. Deccan Aviation founder Capt G R Gopinath said: ���In fact, today we are losing more money on Mumbai-Delhi route than on Mumbai-Kolhapur.���
Aviation analysts say that airlines are planning to cut flights on some small sectors but the real growth in the next few years will come from these sectors. KPMG senior advisor for aviation Mark D Martin said, ���The severe congestion at metro airports because of rapid growth forced airlines to shift operations and re-deploy their aircraft to fast growing tier II and III cities. As fares on metro routes were increased, the passenger load fell. While the higher flight frequencies on regional sectors improved passenger loads, airlines introduced more apex fares leading to spiralling growth thus recording high traffic growth���
Also, airline companies are emphasising on the non-metro routes as the growth there is more than the metro routes.
For the cash strapped airlines, smaller cities and towns are bringing in huge passengers loads even as the troubled aviation sector is looking for new ways to fight rising costs and sustain operations.
According to the latest data released by Airports Authority of India (AAI), while the traffic growth in metros has been in the range of 30-40% in 2007-08, it has more than doubled in the case of smaller towns such as Bhubaneshwar, Jaipur, Ranchi and Raipur , the growth has been in the region of 60-100%.
Airlines are concentrating on the regional routes to keep their operating costs low and increase passenger load. Deccan Aviation founder Capt G R Gopinath said: ���In fact, today we are losing more money on Mumbai-Delhi route than on Mumbai-Kolhapur.���
Aviation analysts say that airlines are planning to cut flights on some small sectors but the real growth in the next few years will come from these sectors. KPMG senior advisor for aviation Mark D Martin said, ���The severe congestion at metro airports because of rapid growth forced airlines to shift operations and re-deploy their aircraft to fast growing tier II and III cities. As fares on metro routes were increased, the passenger load fell. While the higher flight frequencies on regional sectors improved passenger loads, airlines introduced more apex fares leading to spiralling growth thus recording high traffic growth���
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Air traffic is expected to further accelerate in the non-metro cities as the government is investing about Rs 41,000 crore in modernising 35 smaller airports across the country. As infrastructure is still a major constraint in Delhi and Mumbai that handles nearly half of the country's air traffic, airlines are expected to expand in tier II towns and cities.Start a SIP with as low as ₹500 with ET Money App!
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