AVIATION INDUSTRY

Click to edit Master subtitle style Submitted By: Karisma Rawat -24 Smrittee Priya -58 Sneha Bhadra -59 Sonam arwat -60 Vineet Singh -69

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The Aviation industry in India began with the birth of Tata Airlines, through the business relationship between Mr. Nevill Vintcent, a Royal Air Force pilot and Mr. JRD Tata, the first Indian to get an Alicense Tata Airlines became Air India in August 1946 In 1953, the Air Corporation Act nationalized all existing airline assets and established the Indian Airline Corporation and Air India International for domestic and international air services respectively
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HISTORY OF AVIATION INDUSTRY

of private players including Jet Airways,

Macro Environment Analysis

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Political Environment

In April 1990 GOI allowed air taxi operators to operate flights from any airport both on a charter and a non charter basis to decide their own flight schedules, cargo and passenger fares. The operators were, however, required to use aircraft with a minimum of 15 seats and conform to the prescribed rules. Deregulations in different spheres Low entry barriers
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Economic Environment

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Socio-cultural Environment

Growing middle class :

1993-1999 : 39.5 m to 56.7 m households 2005 : 300 m 2010 : 400 m (Estimated)

Increase in leisure travel by tourists by 15 % in 2007 Foreign tourists in 2006 : 3.2 mn

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Technological Environment

Modernization & Privatization of Airports

Modern Technology for efficient handling of aircraft, passenger and cargo. Instrument Landing Systems (ILS), CAT-3

Developing Greenfield Airports with Private Sector

Bangalore Airport Mumbai Airport Hyderabad Airport Airport

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Delhi 4/18/12

Demographic and Natural

Changing pattern of consumers Highest percentage people of age group 20-25 Educational environment Shift towards family concept High energy cost
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Entry Of Private Players

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SCENARIO POST 1991

1991, was the year when the Indian Government came up with the Open Skies Policy In 1994, following the repeal of the Air Corporation Act, private players were permitted to operate scheduled services

Ultimately the carriers with more efficient operations and strategies survived and by 1997, only Jet Airways and Air Sahara made the cut from the original group.

Simplify Deccan an airline started by Captain Gopinath gave birth to the idea of Low Cost Carriers (LCC) or budget airlines
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Market Share Of Major Players

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CONTD..

In December 2004, Indian scheduled carriers with a minimum of 5 years of continuous operations and a minimum fleet size of 20 aircraft, were permitted to operate scheduled services to internationals destinations On January 11, 2005 the government designated four scheduled Indian carriers (Air India, Indian Airlines, Jet Airways and Air Sahara) to operate international services to and form Singapore, Malaysia, Thailand, Hong Kong, the UK and the USA
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A total of 127 airports in the country, which

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Kingfisher Vs Jet Airways

Kingfisher is one of Jet Airways is the the latest Airlines experienced in INDIA. airline in INDIA. Overall growth in year 2006-07 is 37%.

Overall growth in year 2006-07 is 16%.

Kingfisher acquired Jet airways 46% share in Air acquired Air Deccan. Sahara in 2006. Domestic airlines 4/18/12 poised to go

Jet Airways already has

Kingfisher Vs Jet Airways

In a short span of 2 years its market share has become 28% including Air Deccan. Personal in-flight entertainment in every seat. It was awarded the Best New Airline Of the 4/18/12 Year award.

Jet Airways has its market share 31% including Air Sahara. Average entertainment services. Jet Airways won Double Honour Travel Trade Gazette Travel award.

SUPPLIER POWER HIGH

strong labor unions concentrated aircraft makers

Airline Industr y
THREAT OF SUBSTITUTES MEDIUM
autos for short distance travel

THREAT OF ENTRY HIGH entrants have cost advantages low capital requirements little product differentiation deregulation of governmental barriers

INDUSTRY COMPETITIVENESS HIGH

many companies little product differentiation excess capacity high fixed/variable costs cyclical fluctuations of demand

BUYER POWER MEDIUM/HIGH

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Buyers extremely price sensitive Good access to information Low switching costs

What do customers look for?

comfortable journey online purchasing low cost airlines convenient schedule in-flight entertainment and services Customer perception -higher price means better quality
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Changing trend in the market

PAST: air travel was seen as a high quality form of travel

business travellers, especially the frequent less negotiable pricing of airfares flyers, feel that the major airlines are exploiting them. to book last minute deals, which is much cheaper 4/18/12 air hostesses are good looking and are

symbolizing luxury and the status of the consumer Low cost airlines

Seat Factor

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Flight Cancellations

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Passenger Complaints

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Online purchasing and the rise of low cost airline

The emergence of active consumers - those who are better connected, informed and have access to an increasing array of choices, represents a challenge for many industries, especially in travel sector. (Schwartz & O'Neill 2003) With the help of the internet and the e-business, consumers are able to get the hold of information and a better 4/18/12

OPEN SKIES POLICY

Meaning:

Unrestricted access by any carrier into the sovereign territory of a country without any written agreement specifying capacity, ports of call or schedule of services. No restriction Adopted only by a handful of countries

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NEED FOR OPEN SKIES POLICY

PromoteTravel&Tourism The current policy restricts the access of foreign airlines Potential tourists are not offered a choice of airlines or seats Exacerbated during the holiday season Hence allowing for unlimited service, capacity and points of call. 4/18/12

BILATERAL TREATIES

Regularity of operations through scheduled services but also stipulates the basis of ownership, number of seats to be utilized, type and certification of aircraft and visiting ports of call 99%of Members of the InternationalCivil AviationOrganization (ICAO) follow the system 4/18/12

Civil Aviation Policy

Autonomous regulatory authority facilitator for the sector, prescribe and enforce minimum standards for all agencies, settle disputes with regard to abuse of monopoly and ensure level playing field for all agencies.

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OBJECTIVES

Ensure aviation safety, security Effective regulation of air transport Reasonable pricing Flexibility to adopt to changes To provide all players a level-playing field Encourage Private participation Encourage Trade, tourism and 4/18/12

MAJOR CHALLENGES FACED BY AVIATION INDUSTRY

1. 2. 3. 4. 5. 6. 7.

Shortage of trained Employee Regional connectivity Rising fuel prices Declining yields Gaps in infrastructure High input costs Trunk routes

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Airline

Major players in Indian Aviation industry

Call Sign Commenced Operations October 1932 Headquarters Mumbai Kochi Mumbai Chennai Delhi Bangalore Bangalore

Air India AIRINDIA Air India EXPRESS INDIA April 2005 Express Air India 1996 ALLIED Regional (as Alliance Air) Blue Dart BLUE DART 1995 Aviation Click to edit Master subtitle style Club One Air Deccan 360 Deccan Aviation 4/18/12 DECCAN CARGO DECCAN August 2005 2009 1997

Airline

Headquarters GOAIR IFLY JAGSON JET AIRWAYS JET AIRWAYS

Commenced Operations June 2004 August 2006 November 1991 May 1993 May 2009

sHeadquarters

GoAir IndiGo Jagson Airlines Jet Airways Jet Konnect JetLite

Mumbai Gurgaon Delhi Mumbai Mumbai Mumbai Mumbai Mumbai Gurgaon Mumbai

1991 LITEMaster subtitle style JET Click to edit (as Air Sahara) May 2005 August 2003 May 2005

Kingfisher Airlines KINGFISHER Kingfisher Red SpiceJet TajAir 4/18/12 KINGFISHER SPICEJET

AIR INDIA

Air India was founded in 1932. With its fully owned subsidiary Alliance Air, it is one of the largest regional airline systems in Asia. Air India is presently fully owned by the Government of India and has total staff strength of around 31000 employees.

Alliance Air, Air India carries a total 4/18/12 of over 7.5 million passengers

Jet Airways

Jet Airways was incorporated as an air taxi operator on 1 April 1992. It started Indian commercial airline operations on 5 May 1993. It is India's largest airline. It operates over 400 flights daily to 67 destinations worldwide. On 12 April 2007 Jet Airways agreed to buy out Air Sahara for INR14.5 billion 4/18/12 (US$340 million). Air Sahara was

Kingfisher Airlines

Kingfisher Airlines was established in 2003. It is owned by theBengalurubasedUnited Breweries Group. Kingfisher Airlines, through its parent companyUnited Breweries Group, has a 50% stake inlow-cost carrierKingfisher Red. One of the only seven airlines awarded 5-star rating bySkytraxalong withCathay Pacific,Qatar Airways,Asiana Airlines,Malaysia Airlines,Singapore Airlines, andHainan Airlines Kingfisher operates more than 375 daily flights to 71 destinations, with regional and long-haul international services.
4/18/12 Since inception, Kingfisher Airlines is yet to post profit

INDIGO AIRLINES

IndiGois a private,low-cost airlinebased inGurgaon,Haryana,India. It commenced its operations in August 2006. IndiGo was founded by Rakesh Gangwal and Rahul Bhatia. The parent company of the airline is GurgaonbasedInterGlobe Enterprises.
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IndiGo operates to 26 destinations in

Growth of Indian Aviation Industry

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SWOT ANALYSIS

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