Scope for lower air fares seen

According to an Airbus study, despite the large size of country, Indians make on average only one per cent as many annual trips as Americans. “In fact, as many peopletravel on the Indian Railways every day as on all of India’s airlines in a whole year. Thus, the potential for increased air travel in the hugely populous nation becomes more prosperous is obvious,” said Adam Brown, Vice President of France-based Airbus here recently.

Adds Michael Mascarenhas, managing director of Air India: “While domestic fares in India have gone up… international fares have come down. Thus hitting Air India’s bottomlines.”

“In the past, Indian Airlines increased fares consistently following lobbying by private operators… only in the recent days, Indian Airlines realised the potential of cutting fares in order to sell more seats,” said an aviation analyst. In fact – due to fear of competition – the Tatas’ plan to launch a domestic airline was spiked by the successive aviation ministers, including the BJP’s.

To carry 5.3 per cent per year increase in traffic over the next 20 years, the nation’s airlines will have to increase seats in their fleet from the present 19,500 seatsto almost 48,000 seats by the end of 2018, says a study. Yet, the expansion plans of Air India and Indian Airlines are kept in cold storage while private airlines are being given blanket permission to expand. “While the nationalised airlines have been unable to increase fleet, Jet Airways has increased its fleet to 25 which is far higher than even Air India’s 24,” sources said.

The Airbus study says that India’s airlines will need another 52 aircraft in the 210 to 259 seat capacities to cater to the domestic and European operations in the next 20 years. While Air India has evinced interest to buy around 8-10 new medium capacity long range aircraft, Indian Airlines planned to replace its entire fleet of ageing Boeing 737s and Airbus 300s which has been inducted into service in 1976.