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HindustanTimes Tue,23 Dec 2014

In no-frills India, no room for business class

Tushar Srivastava, Hindustan Times  New Delhi, December 08, 2012
First Published: 23:56 IST(8/12/2012) | Last Updated: 02:26 IST(9/12/2012)

Kingfisher is grounded. Air India ailing. IndiGo flies only no-frills. SpiceJet is a low-cost carrier. So what happens to the business class?

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It seems India’s high-flyers have to struggle to get their favourite wide, comfortable seats close to the cabin, or make do with full-service economy seats in a sea of no-frills passengers.

This is strange in a nation where luxury car sales are expected to double in 2012 to 30,000 as compared with 2011 and where there are an estimated eight million people who have the ability to purchase a luxury car worth anywhere between Rs. 25 lakh and Rs. 1.5 crore.

Domestic airlines provide a little more than 200,000 seats a day. Around 10% of the inventory is business class — down from 15% last year.

“There is a huge demand for business class seats. But there is a seat shortage in this segment even on prime metro routes,” said Rajji Rai, adviser to the Travel Agents Association of India.

Senior lawyer and frequent flier Tarun Goomber said, “Thrice in the past few months, I travelled economy as no seats were available in J-class (business) on the Delhi-Mumbai route.” http://www.hindustantimes.com/Images/Popup/2012/12/09_12_pg1b.jpg

For travellers like him, who make last-minute bookings, the problem is more acute. “My staff has told me a number of times that the only seats available during peak hours and in case of last-minute bookings are economy,” added Goomber.

KFA’s grounding took away a chunk of business class seats out of the domestic aviation market, but that was only one of the reasons responsible for the shrinking business class space. The other two full-service carriers, Jet Airways and the cranky Air India, are also bending towards economy class markets.

Air India's irregular flights put off punctuality-conscious J-class passengers, thus limiting their choice, said an industry official.

Low-cost carriers led by IndiGo and SpiceJet control over 60% of the domestic market.

While AI has reduced the number of business class seats, Jet Airways has plans to increase domestic low-fare capacity.

“The luxurious business class offered by Indian full-service carriers is no longer feasible. We expect business class traffic to be limited to metros and only during peak hours,” said Kapil Kaul, South Asia chief executive officer of consulting firm Centre for Asia-Pacfic Aviation.

Industry officials say the on-time performance of low-cost carriers is also drawing busy corporate executives to travel no-frills.

Saj Ahmad, a London-based aviation analyst said less than one percent of the Indian population uses air travel in the first place and "the figures for business class demand and usage is finite and very price elastic".


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