Companies
Air India eyes hub in south, to augment operations in Mumbai
Summary
The Air India group plans to choose between Bengaluru and Hyderabad, both of which have expansion plans to accommodate a growing airline
Air India Ltd is planning its second hub in the country at an airport in south India as it works to strengthen international and domestic operations and maximize network utilization, two executives aware of the plans said. Currently, the airline’s only hub in India is in New Delhi.
“The airline is augmenting its presence in Mumbai and exploring the development of one more hub in southern India," one of the two executives cited above said on condition of anonymity.
The Air India group, which also includes Vistara and Air India Express, plans to choose between Bengaluru and Hyderabad, both privately operated airports, which have expansion plans to accommodate a growing airline, the second executive said. The chosen hub will be used by Air India and Air India Express for both domestic and international flights.
The hub-and-spoke system in aviation is built around a central airport to which all traffic from the spoke airports is directed. The hub serves as a transfer point to fly passengers to their final destination. Some of the prominent international hub airports are Dubai for Emirates, Hong Kong for Cathay Pacific and London Heathrow for British Airways.
Currently, Air India lacks a significant presence at metro airports other than Delhi. Even at the Mumbai airport, the country’s second-largest, IndiGo held a 48% market share in the domestic market in August, followed by Air India with 18% and Vistara with 17%. In the international segment, IndiGo recorded a 22% market share, followed by Air India with 14% and Vistara with 10%.
“The Air India group is committed to operate in smaller airports and larger ones. Air India is keen to work with all airport operators in realizing the vision of an Indian hub," the first executive added.
This comes agaisnt the backdrop of the government pushing for aviation hubs in the country, which will enable one-stop international connectivity via India to other destinations overseas and, in turn, aid the Indian economy with more investments and commerce. Mint reported earlier on the government’s plans to transform Indian airports into aviation hubs, beginning with the Delhi airport, to ensure seamless connectivity and minimize connection time between flights.
“The plan of the government with respect to aviation hubs also involves ideas related to dedicated terminals for airlines. To become a potential candidate for such dedicated terminals in future at other metro airports, the network must be laid out in sync with that," a government official said.
The hub-and-spoke model for Air India is expected to be Air India Express flights bringing domestic traffic from tier-2 and 3 cities for one-stop connectivity to international destinations via Air India flights. Recently, chief executive Campbell Wilson said Air India plans to establish a low-cost stronghold in local routes alongside the broader goal of revitalizing the Tata group-owned airline by refurbishing its entire fleet by the end of 2025.
Air India is expected to receive six new Airbus A350 planes in December, the first from its recent order of 470 aircraft. It has also added 10 aircraft, including six wide-body B777 and four A321neo, this year to its fleet of over 120. Its international departures are up 21% this year, with new flights to Milan, Vienna, Copenhagen and London Gatwick.
