New Delhi: They may have cut flights within the country, but India’s two biggest airlines Jet Airways (India) Ltd and Kingfisher Airlines Ltd, two of country’s biggest carriers by passengers, plan to expand services into profitable routes to destinations in South and South-East Asia this winter season to tap tourist demand which peaks around then.
The move will help the two loss-making airlines utilize their fleets more efficiently. They also stand to benefit from lower jet fuel prices in these markets compared with India.
Jet will launch its direct service between Delhi and Hong Kong using its Airbus SAS made A330 aircraft, double its frequency from Mumbai to Bangkok, and also connect Mumbai with Dhaka over the next three months.
The Delhi-Hong Kong launch is expected to be on 1 October , said a senior government official who asked not to be identified. This will be Jet’s second daily service to Hong Kong after one from Mumbai, said a Jet official who confirmed the move.
“It’s largely because our contribution is much better from the international segment,” added the Jet executive who asked not to be identified, explaining why the company was launching an international flight at a time when its losses are at a high.
Jet connects around 20 international destinations directly and has a fleet of 86 aircraft. With corporate traffic slowing and ticket yields (or the amount of prodit the company makes on each ticket) coming under pressure, the Mumbai-based airline group reported a Rs225.31 crore loss for the quarter to 30 June against a net profit of Rs143.38 crore for the year-ago quarter.
Jet fuel, India’s civil aviation ministry said last week, was available at Rs24,500 a kilolitre in Hong Kong compared with Rs46,000 in Kolkata.
Jet’s rival carrier KingfisherAirlines has also tweaked its strategy on international operations from 15 September by replacing loss-making routes with ones that seem lucrative.
“We have canceled all the bookings for Bangalore-London Heathrow from 15 September onwards and also for Bangalore-Colombo,” said a Kingfisher executive who asked not to be identified.
These flights are to be terminated. Instead, the airline will launch its first flight between Mumbai and Singapore and Mumbai and Hong Kong from the middle of September.
The airline has also applied for permission to fly from Delhi to London but the government hasn’t approved this yet. The airline already has permission to fly to Hong Kong and Singapore.
Kingfisher had previously announced announced a flight to Bangkok from Kolkata which started from 14 August. “The launch of this new route marks the first time that Kingfisher Airlines is operating flights connecting India to South East Asia. Besides catering to the leisure market, the launch of this new route means that pilgrims from Thailand coming into India will be able to benefit from the excellent and convenient onward connectivity to Bodh Gaya,” Siva Ramachandran, vice president (global sales) Kingfisher Airlines said in a statement on Friday.
Kingfisher Airlines has a fleet of around 73 aircraft and and will use its its wide body A330 aircraft to fly international routes of Hong Kong and Singapore.
Both airlines are not inducting any new aircraft into their fleets and have pruned their domestic operations significantly since late last year. An analyst said fares are likely to soften on international sectors were new flights are being added that it was better for airlines to get some revenue from planes which would have otherwise remained grounded.
“They believe they can make more money on those routes than using those planes for domestic, long haul to US/Europe or sitting on the ground,” added this London-based aviation analyst who did not wish to be identified.