History
1911 1932 1938 1946 1948 1953 First commercial flight Airmails from Allahabad to Naini(10 km) The Aviation Department of Tata Sons Ltd. Established Tata Airlines (successor to aviation division of Tata Sons) Tata Air Lines converted into a public Company and renamed Air India Limited Air India International incorporated Nationalization of Aircraft Industry
Air India (serving the international sectors) Indian Airlines (serving domestic sectors) Deccan Airways, Airways India, Bharat Airways, Himalayan Aviation, Kalinga Airlines, Indian National Airways and Air Services of India
History
1986 Private Sector Players permitted as Air taxi operators
Players including Jet, Air Sahara, NEPC, East West, Modiluft,etcstarted service
1990 1994 2003 2007 2008
Open Sky Policy Private Carriers permitted to operate scheduled services Entry of low-cost carriers Merger of Indian Airlines into Air India Acquisition of Air Sahara by Jet Airways Kingfisher acquired 49% stake in Deccan Aviation
Regulatory Authorities
Ministry of Civil Aviation
Responsible for the formulation of policy, development and regulation of Civil Aviation. Its functions also extend to overseeing airport facilities, air traffic services and carriage of passengers and goods by air
Other Attached/Autonomous Organizations:
Directorate General of Civil Aviation (DGCA)
Promote safe and efficient Air Transportation through regulation and proactive safety oversight system Regulatory authority for civil aviation security in India
Bureau of Civil Aviation Security (BCAS)
Airport Authority of India (AAI)
Accelerate the integrated development, expansion and modernization of the operational, terminal and cargo facilities at the airports
Policies
Open Sky Policy FDI Airports
100% for green field operations 74% for existing airports - 100% with special permissions 100% tax exemptions for 10 yrs.
Airlines
49% in domestic airlines - 100% for NRI’s 74% in cargo & non-scheduled airlines
Market Share in Domestic Market
In Post Consolidation Jet includes Air Sahara & Kingfisher includes Air Deccan
§Market Share is based on their Capacity Source: B&K Securities
Service vs. Price
High Kingfisher Jet Airways Indian Airlines
First class, Premiere(Business) class & Economy class
Target Segments
Premiere(Business) class Business travelers, contribute 48% of passengers & 66% of revenues, ready to pay higher prices, last time booking, don’t like transit Economy class Leisure travelers, prefer low cost airlines, ready for transit if there is cost advantage, large % of passengers
Seat Allocation – Yield Management Technique Positioning – High value for High price Unique Selling Price – Customer relationship and Punctuality
Seating in flights for Segments
Fleet Size
Flower of Services
Information - Reg. the org., flight schedules, ticket fares, promotion schemes etc.
Through website, call service, sms, employees etc.
Consultation - Reg. the choices of class, routes to a destination & special menus for frequent fliers Order taking - Booking - through phones, fax and internet - Ticket Office, Call Centres, Company Website & Agents Hospitality - Most important differentiating factor (from ticket booking t o post flight help) Safe keeping - Luggage & Children Exceptions - Special requests reg. meal preferences, special amenities for elderly people or children, medical needs etc. Billing - Charges split, E-mail bills etc.
Payment - Credit card, Travellers cheque, Special payment privileges for frequent fliers
Impact of IT on Ticket Booking
Levels of Product
Product - Service
On Ground Services
Check in options - Airport check-in, Tele Check-in, Web Check-in, Kiosk Check-in, SMS Check-in, Check-in while walk-in, One Time Check-in on Return Journey, Through Check-in
Airport Lounges Coach Services
In-flight Services
Classes of Service - First class, Premiere class & Economy class Convenience & Safety -Towels, Pillows & Blankets, Reading material, First Aid, Smoke detectors, Bassinets, Child Care, life jackets & seat cushion Cuisines Entertainment - Jetscreen– Movies, TV programmes, Games, Music, In-flight communicator, Online magazines etc. JetWings (in-flight magazine), JetBoutique (in-flight shopping catalogue)
Product - Service
Special Services
o Infant and child care, wheel chair assistance, expectant mothers, unaccompanied minors, medical emergencies, travelling with animals & carriage of stretchers
Personalized web access JP Miles - 13 quarters validity Bonus JPMiles on e-Services Additional baggage allowance Guaranteed reservations up to 24 hrs. prior to departure Waiver on cancellation fees Membership Tier Bonus
Earning & Redeeming JP Miles
Eg: Chennai to Thiruvananthapuram (Earn Mile-383 & Redeem Mile-6894)
Airline Partners - Air France, American Airlines, ANA, Austrian Airlines, Brussels Airlines, Cathay Pacific, Dragonair, Etihad Airways, Gulf Air, JetLite, KLM, Lufthansa, Northwest Airlines , Qantas, South African Airways, SWISS, United Airlines and Virgin Atlantic.
Price
Economy & Club Premiere Fare Discounted fare for senior citizens & defense personnel Advance Passenger Excursion/ APEX Fares One Fare Night Saver Fares Check Fares US Dollar Fares & Visit India Fares
Place
Place of Service - Aircraft Various Destinations
Promotion
Offers
Companion Free Offer, One Fare, Concessional fares, JetPrivilege Offers, Jet Airways Citibank Credit Cards, Corporate Deal Offers, International Specials, Camp Rock contest, Festival specials, Student specials, Surprises etc.
Partners
Airline Partners - Air France, American Airlines, ANA, Austrian Airlines,
Brussels Airlines, Cathay Pacific, Dragonair, Etihad Airways, Gulf Air, JetLite, KLM, Lufthansa, Northwest Airlines , Qantas, South African Airways, SWISS, United Airlines and Virgin Atlantic. Code Share Partners - Air Canada, All Nippon Airways, American Airways, Brussels Airlines, Etihad Airways and Qantas Co-Brand Cards - CitiBank Conversion Partners - BarclayCard, CitiBank, Deutsche Bank AG, HDFC Bank, HSBC, ICICI Bank, SBI Card & Tata Cards Car Rental Partners - Avis, Hertz Hotel Partners - Global Hotel Alliance, Hilton Family Hotels, Hyatt Hotels & Resorts, InterContinental Hotel Groups, ITC etc. Lifestyle Partners - Globus and Golf Fee Card International Publishing Partners - Fortune, The Economist and TIME Retail Partners - Ferns n Petals Telecommunication - Matrix Cellular Services
Competitors
International market - British Airways & South West Airlines Domestic market - King fisher, Indian Airlines, GoAir, Spicejet & Indigo
Process
People Processing
People physically enter the service system to receive the service. Aircraft is the service factory where service is delivered.
Strategies to manage the Capacity & Demand
Check Fares Automated Rostering System Planning and Scheduling Systems Code Sharing Outsourcing ramp handling, passenger handling, ticket checking, cargo and loading and unloading in Delhi and Mumbai Automation to drive efficiency and improve response time Faster page and application download times for its site
Corporate Social Resposibility
Magic Box
Fund raising inside the flight for disaster relief, education & healthcare for poor and programmes to prevent exploitation of women
Flights of Fantasy
Underprivileged children and children with special needs are taken on specially organized flights (on Children’s Day)
PEST Analysis
Political Issue
License issue for international operation Infrastructural constraint ATF price policy
Economic Effects
Rising income level Reduced fare but yet not enough
Technology Effects
Modernization of aircrafts Modern technology like CAT3 and ILS
SWOT Analysis
Strengths
Market driver Experience exceeding 14 year Only private airline with international operation Market leader Largest fleet size
Opportunities
Untapped air cargo market Scope in international service and tourism
Weaknesses
Loosing domestic market share Old fleet with average age around 4.79 years Scope for improvement in in-flight service Weak brand promotion