Civil Aviation in India : Challenges and Prospects

Author: Hormuz P Mama
Publisher: Rupa
Year: 2009
Language: English
Pages: 115
ISBN/UPC (if available): 9788129115485

Description

India, with a population of 1.1 billion, would seem an ideal environment for air travel. However, in reality, the air travel market of India is much smaller than believed, and just about 2.5 percent of the population flies at least once of the population flies at least once a year. By misjudging the size of the market, India’s airlines have created gross excess capacity which continues to plague them.

India is not a suitable country for low-cost airlines, as most of their costs are comparable to those of full-service carriers. For international passenger operations, Indian carriers face fierce competition, and require concentrating on routes with fewer competitors as the entry of global giants has made of the rupee against the US dollar also hurts the Indian carriers, as does the very poor airport infrastructure.

This book highlights the challenges faced by the aviation industry as well as the remedial measures, which if put into practice will take our aviation industry to newer heights.

Contents

Preface
Acknowledgement
Executive Summary

1. Introduction
1.1 The Global Air Transport Industry

2. Poor Penetration of Air Services in India
2.1 Poor Purchasing Power
2.2 A Highly Price-sensitive Market
2.3 Comparison with Other Countries
2.4 Conclusion

3. Over-capacity – A Problem without a Solution
3.1 The Passenger Growth Rate
3.2 Unrealistic Capacity Growth
3.3 No Provision for a Downturn
3.4 Failure to Time the Market
3.5 The Price of Miscalculation
3.6 Conclusion

4. The ATF Price Spike – No Longer the Most Serious Problem
4.1 The Uncontrollable Accent
4.2 Oil’s not Well
4.3 Disproportionately Heavy Taxation
4.4 The Mother of All Taxes
4.5 More Efficient Fuel Distribution Needed
4.6 Conclusion

5. Rules of the Competition Game
5.1 The Indian ‘Free-for-All’
5.2 The Craze for Market Share
5.3 Excess Staff
5.4 Conclusion

6. Irrational Ticket Pricing
6.1 The Herd Mentality
6.2 Extremes of Irrationality
6.3 Migration from FSCs to LFCs
6.4 Conclusion

7. Need for Experienced and Capable Top Management
7.1 A Bottomless Pit for Resources
7.2 How Not to Run an Airline
7.3 Conclusion

8. Need for Consolidation
8.1 Jet’s Acquisition of Air Sahara
8.2 Kingfisher’s Acquisition of Air Deccan
8.3 The Air India-Indian Airline Merger
8.4 India’s First Airline Consolidation?
8.5 Conclusion

9. Services to Smaller Towns
9.1 Poor Connectivity for Small Towns
9.2 Lower Charges for Regional Aircrafts
9.3 Eliminate Route Dispersal Guidelines
9.4 Conclusion

10. India not the Right Environment for Low-Cost Carriers
10.1 The Global Scenario
10.2 The Situation for Indian LFCs
10.3 Existing Indian Secondary Airports
10.3.1. Unavailability of Secondary Airports
10.3.2. High Staff Costs
10.3.3 Other Factors against LFCs
10.4 Conclusion

11. Competition from the Railways for the Lower End of the LFC Market
11.1 Myths and Realities
11.2 Busting the Myth
11.3 Conclusion

12. Business Jets to Take Away Premium FSC Passengers
12.1 The Global Scene
12.2 India a Major Market for Business Jets
12.3 Business Jets as a Productivity Tool
12.4 Competition for the Airlines
12.5 Conclusion

13. The Global Financial Situation and its Impact on India’s Airlines
13.1 The Global Economic Downturn
13.2 The Indian Economy
13.2.1 The Falling Rupee
13.3 Inflation

14. International Operations for India’s Domestic Airlines
14.1 Advantages and Disadvantages
14.1.1 Intensity of Competition
14.2 Conclusion

15. Air Cargo
15.1 Domestic Cargo
15.2 International Cargo
15.3 Conclusion

16. Maintenance, Repair and Overhaul
16.1 Poor Presence in India
16.2 Conclusion

17. Airports
17.1 Introduction
17.2 Development Work
17.3 Low Investment over Past Years
17.4 Airports: An Investment-intensive Industry
17.5 Too Little Investment by India for Navi Mumbai Airport
17.6 The Public – Private Partnership Approach
17.7 Wrong Choices
17.7.1 A New Airport for Greater Noida
17.7.2 Nagpur Airport as an International Hub
17.7.3 Airport Projects Galore
17.7.4 Private Airports for Industrial Development
17.8 Need for Long-term Planning
17.9 Non-aeronautical Revenue
17.10 City-Airport Road and Rail Links
17.10.1 Road Links
17.10.2 Railway Connections
17.11 Airport Charges
17.12 Conclusion

18. Recommendations

References
Appendix
Index