Chennai: There is mixed response to the entry of low-cost carrier AirAsia India in the country’s domestic aviation market, which has been ailing for the last few years.
While air passengers feel that the Malaysian HQ AirAsia backed by the Tata group in India would offer better facilities to travellers at a low cost forcing other operators in the country to follow suit, aviation analysts feel that the industry would sink further.
Air Passengers’ Association of India (APAI) president D. Sudhakara Reddy said that the new entrant would bring competition to the market and it would be beneficial to passengers in the long run.
“We will get better service, schedules and cost,” he added. APAI secretary Hiren Shah further said that the entry of AirAsia India would help build capacity and consumers would also have more choices to choose from.
Sharat Dhall, president of ticketing portal yatra.com, said that the entry of AirAsia India would catalyze growth in the domestic air market that had been sluggish for the last couple of years. “The airline has been launched well. But we need to see how quickly it can expand and add capacity. I don’t think it will kill other players. Already we have a strong market leader in Indigo and it is not going to be a pushover,” he added.
However, Amber Dubey, partner and India head of aerospace and defense at global consultancy KPMG, said that the price war had already begun and would only intensify in the lean July-September quarter. “If an unbridled fare war continues including peak hour seats, we may see financial distress increasing and the probable exit of one or two airlines in the next 12-18 months,” he added.
According to him, the Indian passengers should make the most of the deeply discounted fares while it lasts.
“Once the din dies out, airfares need to be hiked in line with the high operating cost prevailing in India, else the financial distress in the sector may prolong,” he said. On amenities provided to passengers, Mr Dubey said that the new airline might actually decide to offer lesser freebies and lesser passenger comfort....