Mumbai: More passengers kept away from domestic airlines in 2008 than the previous year as ticket prices increased because of rising jet fuel costs, nearly halting years of low-cost flying.
Domestic airlines flew 40.77 million passengers in 2008, 4.84% less than the 42.85 million the year before, the regulator Director General of Civil Aviation (DGCA) said in its monthly report.
Passenger growth crashed by 17.17% in December to 3.32 million from 4.01 million a year ago.
Vijay Mallya-controlled Kingfisher Airlines Ltd, which merged the low-cost Deccan Aviation Ltd with itself last year, retained in the top slot for market share by passengers with 27.1% in December, but lower than the 29.8% a year earlier.
Turbulent time: Airlines carried 40.77 million passengers in 2008 compared with 42.85 million in 2007. Hemant Mishra / Mint
Jet Airways (India) Ltd, the country’s largest private airline by sales, and its low-cost subsidiary JetLite (India) Ltd, together were next with 24.4%, down from 29.5% in 2007.
State-owned carrier National Aviation Co. of India Ltd, which operates Air India, is in the third spot with 16.8% in December, against 14.9% last year.
Delhi-based low-fare airline IndiGo, run by InterGlobe Aviation Pvt. Ltd, gained substantial market share to become the largest low-fare carrier in the country. IndiGo’s market share went up to 15.4% from 9.9% in the year-ago December.
“Even though we do not chase market share per se, we have grown as usual to 15% market share,” said Aditya Ghosh, president IndiGo. “More and more passengers are travelling with us, the largest low-fare carrier, in such a short time.”
SpiceJet Ltd, another Delhi-based low-fare airline, saw its market share rise to 11.2% in December from 10.1% earlier. Paramount Airways’ market share went up to 2.4% from 1.2% while GoAir’s fell to 2.3% from 4.3% earlier.
According to a report published by aviation consulting firm Centre for Asia Pacific Aviation (Capa) on passenger growth outlook, domestic traffic for the 12 months ending 31 March may decline by 10-12% year-on-year.
“The promotional pricing announced in January 2009 may only have a marginal impact as there continues to be a substantial margin between fares of low-fare carriers and second class air-conditioned rail travel,” Capa said in its report.
“The slowdown in Q4 is expected to be felt across all segments of travel—corporate, leisure and visiting friends and relatives,” the report said.
Capa chief executive officer (Indian subcontinent and West Asia) Kapil Kaul said, “A drop of 4.84% passenger growth is moderate considering the overall recessionary trend. This modest dip is mainly because of calculating passenger figures in calendar year.”