Exclusive: Akasa Air pulls off a surprise, launches codeshare with Etihad
- With the deal, Akasa Air can deploy additional capacity to Abu Dhabi, helping strengthen its international presence, increase utilization, and corner rights where they are still substantially available, unlike other places.
Over the weekend, Mumbai-headquartered Akasa Air quietly launched a surprise move. While not announced formally by either of the airlines, Akasa Air flights with Etihad codeshare started popping up on the booking engine of Etihad.
Flights to Abu Dhabi from Ahmedabad and Bengaluru, which begin in March 2025 are listed for booking on the Gulf carrier’s website with “Operated by Akasa Air” being called out and an Etihad flight number. Akasa Air is also selling those flights on its website. This will be the first and only codeshare for Akasa Air, which started operations in August 2022.
This gives Akasa Air a leg start like no one before has had. IndiGo, for example, had its first codeshare in 2019, having begun operations in 2006. Go FIRST, did not have a single such arrangement in 18 years of its existence. SpiceJet does not have a codeshare arrangement, after its much publicised announcement with Emirates, which never took off.
What is a codeshare arrangement?
A codeshare is a commercial arrangement between two airlines, which helps carry passengers of each other seamlessly and involves transfer of baggage, along with passenger and earning of miles wherever loyalty programs are involved. The carrier selling the itinerary is called the marketing carrier while the carrier flying the passenger is the “operating carrier”.
Etihad was an equity investor in Jet Airways. As part of the Jet Airways restructuring, the bilateral seat quota was increased between India and Abu Dhabi, one of the few places where the bilaterals are signed with specific emirate separately and not the country as a whole. The Jet Airways network restructuring saw multiple cities in India being connected to Abu Dhabi, which saw Etihad increase its feed and many Tier II cities within India get access to a worldwide network. With the fall of Jet Airways, Etihad lost this feed completely.
Win-win for both
The India-Abu Dhabi bilateral sees the Abu Dhabi side utilise nearly all its rights with limited room for expansion, while there still remains a substantial gap on utilisation from Indian side. Akasa Air, due to its late start, has not been able to grow internationally the way it would have desired, since the rights are already with other carriers, largely IndiGo and Air India group, especially to lucrative points like Dubai or Singapore.
With the deal, Akasa Air can deploy additional capacity to Abu Dhabi, helping strengthen its international presence, increase utilization, and corner rights where they are still substantially available, unlike other places. For Etihad, this means more feed from India, at a time when it cannot add more flights on its own and has ambitions to grow globally which means it will need feed from the most populous nation on earth. Eventually, Etihad could look at having Akasa Air work out what Jet Airways could not.
Bilateral games
International flights, except for those under open skies, are governed by the Bilateral Air Services Agreement (BASA). The rights could either be by seats or frequencies or a combination of both.
The next thing to see will be if Akasa Air copies the IndiGo model of not just flying to the hub of a third carrier, having a codeshare arrangement and not stopping at that but inducting wet-leased aircraft from these carriers, as has been the case with Turkish Airlines and Qatar Airways with IndIGo. Will Akasa Air, which also is at the receiving end from Boeing for missed deliveries and taking the delivery schedule haywire look at alternative means to raise capacity?
Tail Note
It's very early in the lifespan that Akasa Air has joined the codeshare bandwagon and it's an indication that the airline had geared up on the Information Technology side right from the word go. The airline which got funding from Late. Jhunjhunwala has made multiple news in the past about funding, but has formally maintained that it remains well capitalised. The airline also placed an order early this year at Hyderabad for additional Boeing MAX aircraft. A codeshare arrangement and a new revenue stream will help increase its valuation and having a partnership with Etihad will be taken positively by the market.
It now needs planes and more of them to add flights to Abu Dhabi to make the most of this partnership. Will Boeing resume deliveries soon? While the airline knew the pitfalls with the MAX while it signed up, one expected things to get better at Boeing. Instead, the airplane maker was plagued with a strike, a major safety issue with the MAX with a non-usable door flying out and repeated news around one or the other quality issue, all of which has impacted delivery schedules for Akasa Air. Will the tide now turn?
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First Published:8 Dec 2024, 04:46 PM IST
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