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Year 2013 Airlines see growth in India Asia A Good sign after long Global Aviation Recession

Airlines see growth in premium economy service from India

Several incumbent carriers that see growth opportunities are mainly from emerging regions such as Asia, Africa and West Asia.

Foreign airlines remain interested in India despite challenges.

A number of carriers have either suspended services to India ( such as AirAsiaX, American Airlines and Qantas) or have reduced frequencies on certain routes (Air France, Austrian and Lufthansa).

Jet Airways recently announced plans to suspend its Mumbai-Johannesburg service from June.

Reasons for these reductions include insufficient traffic, poor yields and high airport charges, according to the Centre for Asia Pacific Aviation, a research agency on aviation.

Apart from AirAsiaX, these are largely carriers that face competition from Gulf and Asian carriers on routes to/from India.

AirAsiaX's withdrawal was in part due to the weakness of its direct distribution strategy in the Indian market, which could not support the capacity generated by 11 weekly wide-body services into Kuala Lumpur, the agency said.

However, CAPA says there are several incumbent carriers that see growth opportunities.

These are mainly from emerging regions such as Asia, Africa and the West Asia with examples including:

Dragonair has announced plans to launch services to Kolkata from Nov-2012.

Etihad will launch Abu Dhabi-Ahmedabad services, effective Nov-2012.

Virgin Atlantic will be resuming London-Mumbai services from Oct-2012.

Kenya Airways commenced non-stop Nairobi-Delhi service in May-2012.

Air China launched Chengdu-Mumbai service in May-2012.

Iraqi Airways launched routes from Baghdad to Delhi and Mumbai in first quarter. BMI commenced London-Amritsar service in Oct-2011.

SilkAir launched a new Singapore-Kolkata route in Aug-2011.

Singapore Airlines has launched five additional frequencies to Mumbai last year.

Virgin Atlantic will benefit from the suspension of Kingfisher's Mumbai-London operation.

It plans to schedule the service to facilitate convenient onward connections to at least four US destinations. It is expected to emerge as an important player on Mumbai-UK and Mumbai-US routes, says CAPA.


Meanwhile, Africa is a region of growing interest.

Kenya Airways, which launched its second Indian destination in May-2012, has identified Ahmedabad, Bangalore, Chennai and Hyderabad as cities that it plans to expand to over the next few years.

Ethiopian Airlines has similar expansion plans and has suggested that its Addis Ababa hub could play an important role in carrying traffic between India and South America.

Several airlines that do not currently operate to India are understood to be evaluating the possibility of entering the market in the next 12-24 months.

These include Alitalia and Czech Airlines (in Europe); Garuda Indonesia, Jetstar Asia, Lion Air, Myanmar Airways and Vietnam Airlines (in Asia) and Air Austral (Africa).


But it is carriers such as Emirates, Qatar Airways and Turkish Airlines that have the most aggressive expansion plans and are pushing for additional ‘bilaterals' as their current entitlements are exhausted.

Emirates, the largest foreign carrier in India, already operates 184 weekly services to 10 cities across India, not including its low-cost subsidiary, Flydubai, but has exhausted its ‘bilaterals'.

Turkish Airlines, which has a daily service to Mumbai and Delhi, is seeking to increase this to double daily and wishes to operate to an additional six destinations.

Singapore Airlines and Cathay Pacific are also expected to seek increased rights, CAPA said in its analysis on Indian aviation.

Year 2013: Goldman Sachs bets on emerging markets, India ... 2013? Do you see ... Asia. We are looking generally at a slight firming of growth for most Asian economies next year.

 Asia Pacific region will rise 5% next year ... in Asia Pacific in 2013, while ADR growth ... of India, Bangkok and Shanghai (both +9%) are expected to see the strongest growth.

India, China and Latin America would continue to lead the growth next year in the ... we would see ... growth." He, however, also pointed out that Asia-Pacific airlines, despite


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