New airlines gain more ground

BANGALORE: Challenger airlines like Air Deccan, Kingfisher Air, SpiceJet and Go Air continue to eat into the market share of incumbent carriers like Indian Airlines, Jet Airways and Air Sahara.

Statistics put out by the director-general of civil aviation (DGCA) on the airline market share, between September 2005 and April this year, show that all legacy airlines have lost market share even as challenger carrier are beefing theirs.

As per DGCA figures, the legacy operators have lost 14.26 percentage points as their share fell from 81% (September 2005) to 66.74% in April 2006. Of this, 4.56 percentage points were lopped off between January and April this year.

Interestingly, their loss has been start-up airlines’ gain. The share of new airlines has moved up 14.4 percentage point from 19% to 33.4% during the same period. In the first four months (January-April) of this calendar year, they have cornered 6.56 percentage points.

And who do you think is the biggest loser? It’s the one-time undisputed market leader -Jet Airways (which still is, but with a smaller lead). Its market share during the same period decreased 6.4 percentage points from 41% to 34.6%. The full service carriers’ share has been ranging in the region of 34% and 36% since January this year.

If the combined market share of Jet and Air Sahara (which was acquired by Jet in January this year for Rs 2,300 crore) is taken, then the fall is quite steep at nine percentage points, from 52.5% to 43.5%. Sahara’s market share has tumbled 3.1 percentage points since the takeover, from 11.6% in January to 8.5% in April.  During this four-month period, Jet-Sahara market share has slumped 9.7 percentage points from 46.2% to 36.5%.

The airline that has bitten off the largest chunk of the aviation pie is budget carrier Air Deccan. It has scaled up its share by 6.8 percentage points to 16.7% in April from 9.9% in September last year.

This low-cost carrier, promoted by ex-pilot Captain G R Gopinath, is now missing Jet’s half market share size by 1.2 percentage points.

Another casualty among the new breed of airlines is state-owned Indian (Indian Airlines). Indian’s market share has eroded 4.86 percentage points in the eight-month period from 28.5% to 23.64%. Since January, it has dropped 1.36 percentage points from 25% to 23.64% in April.

Jet’s rival in the domestic market - Kingfisher Air - took 3 percentage points of the market as it increased its share from 4.6% in September last year to 7.6% in April. Last four months have seen its market hover between 7.6% and 8.7%. SpiceJet’s market share from September 2005 to April this year has also climbed 2.5 percentage points from 4.5% to 7.01%. Go Air, which has started releasing its market share figures since February this year, has seen its share rise from 1.8% in February to 2.09% in April.