Nevrekar
27th Apr 2008, 05:35
We (SpiceJet Ltd) were born (May 23, 2005) around the same time as DNA. In our journey of these 1,000 days of operation, we have seen tremendous changes. Aviation was primarily a low-growth sector, where emphasis was on services rather than cost efficiencies. But, in the last few years, airlines have become very conscious of costs and are trying to cut as much flab as possible to survive the competition that has plagued the industry.
And with discipline in cost management, average fares have fallen. This has led to the aviation pie growing several folds. There has been a huge expansion in the consumer base of the industry.
However, even as domestic air traffic has shot up over the last few years, players are suffering with their yields slipping to commercially unviable levels. Airlines are trying to grab bigger share of the market by undercutting fares to take on competition.
What is, perhaps, interesting is that with growth of the private airlines, the long pending issue of inadequate infrastructure has been sorted out. Today, our airport infrastructure is of international standard.
At the industry level, players need to assess capacity induction. Any further addition of capacity (aircraft) should match with the growth projections. With jet fuel prices shooting up (currently at $119 per barrel), fares cannot be maintained at low levels, and therefore there is no way to stimulate demand as there was 1,000 days ago.
So it is very important for airlines to reassess their capacity addition plans to ensure that it (aircraft) does not lie idle.
These 1,000 days have seen a lot of flip flop on the policies and regulations front too. While the civil aviation ministry's policies, in general, have been very airline friendly, there is an urgent to address the policy on international flying rights. The ministry is open to allowing foreign airlines which have barely finished one year of operation to fly in, but when it comes to giving international flying rights to Indian carriers, it puts the eligibility condition at five years.
This has affected the plans of many Indian airlines to start overseas operations. Let's hope that in the next 1,000 days, such discriminatory policies will disappear.
Sharma is executive chairman, SpiceJet
As told to Praveena Sharma
Home | MumbaiLatest in Mumbai:
And with discipline in cost management, average fares have fallen. This has led to the aviation pie growing several folds. There has been a huge expansion in the consumer base of the industry.
However, even as domestic air traffic has shot up over the last few years, players are suffering with their yields slipping to commercially unviable levels. Airlines are trying to grab bigger share of the market by undercutting fares to take on competition.
What is, perhaps, interesting is that with growth of the private airlines, the long pending issue of inadequate infrastructure has been sorted out. Today, our airport infrastructure is of international standard.
At the industry level, players need to assess capacity induction. Any further addition of capacity (aircraft) should match with the growth projections. With jet fuel prices shooting up (currently at $119 per barrel), fares cannot be maintained at low levels, and therefore there is no way to stimulate demand as there was 1,000 days ago.
So it is very important for airlines to reassess their capacity addition plans to ensure that it (aircraft) does not lie idle.
These 1,000 days have seen a lot of flip flop on the policies and regulations front too. While the civil aviation ministry's policies, in general, have been very airline friendly, there is an urgent to address the policy on international flying rights. The ministry is open to allowing foreign airlines which have barely finished one year of operation to fly in, but when it comes to giving international flying rights to Indian carriers, it puts the eligibility condition at five years.
This has affected the plans of many Indian airlines to start overseas operations. Let's hope that in the next 1,000 days, such discriminatory policies will disappear.
Sharma is executive chairman, SpiceJet
As told to Praveena Sharma
Home | MumbaiLatest in Mumbai: