future of domestic aviation

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Information about future of domestic aviation

Published on December 27, 2008

Author: banglorehodga

Source: authorstream.com

Slide 1: Submitted by : v. jayan nair Slide 2: CONTENTS ACKNOWLEDGEMENT FUTURE OF DOMESTIC AIRLINES WHERE DO I FIT IN THE PICTURE HOW DID I BENEFITED FROM DOING THE RESEARCH ADVANTAGES AND DISADVANTAGES OF AVIATION INDUSTRY BIBLIOGRAPHY Slide 3: FUTURE OF DOMESTIC AIRLINES BEFORE GOING TO FUTURE OF DOMESTIC AIRLINES WE HAVE KNOW ABOUT CHARACTERISTICS OF INDIAN AVIATION KEY PLAYER IN INDIAN AVIATION CURRENT TRENDS IN INDIAN AVIATION OPPORTUNITIES FOR INDIAN AVIATION CHALLENGES FOR INDIAN AVIATION Slide 4: AVIATION INDUSTRY IN INDIA :CHARACTERISTICS Huge Potential Under penetrated market Total Passenger Traffic : 50 million Passenger trips per annum : India : 0.05 United states : 2.02 Untapped air cargo market Slide 5: Number of airports that supports growth Key Concern: Monopoly control, no competition, no regulation on pricing yet = bad for consumers Approx 450 airports managed by AAI, defence services, state governments or private parties. Out of this only 61 airports are currently used by Airlines AAI manages 126 airports in India Due limited financial resources with AAI, airport infrastructure is being privatised to cater to total investment requirement of USD 9 billion over the next 5 years. Bombay & Delhi Privatised. New Airports at Bangalore & Hyderabad ready by mid 2008. Apart from Cochin airport, which is already privatised, there are 6 key airports in various stages of privatisation Slide 6: AVIATION INDUSTRY IN INDIA : CHARACTERISTICS MASSIVE GROWTH: Expansion of air transport is the fastest in the world. to grow by 20-35% Driven by LCCs, - expected to grow @ 45.6% CAGR - legacy carriers @ 10.6% CAGR 50% growth in Market Capacity for the last 6 months – 500,000 seats added in Nov 06! Current Economy class seat capacity: 22,316. Future Economy class seat capacity: 71,476. Market Capacity to increase by 220% over the next 5 years. Booming Economy: GDP growth of 8% (2006-07). Air transport will grow at twice GDP rate in India - 16% range in 2007 Carriers operating in India has grown from two state-owned players in 1991 to eleven today. LCC are stimulating growth and on a world wide perspective the most profitable FUEL COSTS: 70% higher than International standards - not supporting ailing industry. INFRASTRUCTURE, REGULATORY & GOVERNMENT SECURITY DEPLOYMENT CONSTRAINTS FIERCE COMPETITION: India unique…No consolidation yet! Slide 7: KEY PLAYER IN INDIAN AVIATION Air India Air India is a government owned national carrier intended for international destinations. Air India however offers domestic travel to fill in seats between Indian cities on its international routes. Indian Airlines A government owned and oldest airline operation, Indian Airlines flies to all the operational airports in the country. Indian Airlines offers promotional fares on selected routes and a limited number of seats through online auctions. Business class is offered on most flights. Indian Airlines also flies to a few international destinations in the neighboringJet Airways Jet is India's large privately owned airline and has the highest market share of Indian domestic traffic. This domestic carrier’s market share in Aug ’04 was over 43%. It has emerged as India’s largest private domestic airline and has been acclaimed by frequent travelers as the most preferred carrier offering the highest quality of comfort, courtesy, standards of in-flight and ground services and reliability of operations. Air Sahara Air Sahara offers flights through all the major Indian cities and some smaller cities in the northern states of Uttar Pradesh and Bihar. Air Sahara offers business class on most flights. It operates 19 fleet out of which 7 are CRJ-200s. It operates two B737-800s, five B737-700s, three B737-400s, and two B737-300s (19 in total). Slide 8: KEY PLAYER IN INDIAN AVIATION Air Deccan INDIA'S first and leading discount operator, Air Deccan flies most large Indian cities and a number of small cities in the southern states of Karnataka, Tamil Nadu, Andhra Pradesh and Kerala. Air Deccan is a no-frills operator with free seating on the flights, no drinks or refreshments on board. Kingfisher Airlines, a budget airline, is to begin in May. It has ordered 10 single-aisle planes worth $1.8 billion. Royal Airways Ltd. announced the launch of its new low-fares, no frills brand, SpiceJet . SpiceJet , headquartered in New Delhi, ordered for 10 Boeing 737-800s Air India Express (a subsidiary of Air India), effective March 2005, will have a fleet of 14 Boeing 737-800s, which will be taken on dry lease in three phases. Within a year of operations, Air-India Express will operate a total of 127 flights with 14 aircraft to destinations in the Gulf and South-east Asia. Eighteen B737-800Ws will be purchased which on induction, will replace the capacity currently being taken on lease by Air India Express for commencing operations effective March-April 2005. OPPORTUNITIES- Shift from busses & trains to planes…in progress : FARE COMPARISON IN KEY ROUTES – TRAINS TO PLANES People getting richer : household incomes, growing domestic tourism, railway passengers & airline choice Regional Economies benefit: every $100 spent on air transport produces benefits worth $325 to the economy and 100 additional jobs in air transport result in 610 new other jobs. (Economic Times: Jan 17th 2007) Employment Opportunity: 40 Lakh Aviation Jobs in the next 10 years (Civil Aviation Minister, Mr. Praful Patel) Underwritten Deals: Air Deccan has pioneered regional connectivity sponsored by local companies. State Sops: If states want to drive economic growth, they need to provide more sops. Air Travel a commodity & no longer a luxury OPPORTUNITIES- Shift from busses & trains to planes…in progress Tiny Domestic Market…will be the largest in the world : 10 Tiny Domestic Market…will be the largest in the world Currently domestic passenger market is growing at 50% Source: Airport Authority of India / Air Deccan prospectus “Since the arrival of low cost airlines in india , market has been growing at over 20% per annum” Rising Income of Urban Middle Class Tiny Domestic Market…will be the largest in the world Slide 11: CHALLENGES Slide 12: Infrastructural Constraints - 2007 Critical Growth constrained by infrastructure much higher costs i.e. bad for consumers Airport Charges are stupidly high for a very poor service Security Charges – Exorbitant Not enough night parking – more concrete required Not enough gates Not enough office / support space Not enough counters Security machines – not enough causing delays Security staff – hamper our airlines due to shortages at gates Air Traffic Control – increase runway usage Poor facilities for passengers – toilets, retail, restaurants, parking, etc, Baggage system needs urgent upgrade Maintenance Facilities Skilled manpower Airport FODs & birds i.e. Indian airports are bird sanctuaries E.g. CCU has 8 departures, 2 gates, 1 security machine, shortage of security personnel = massive delays Slide 13: Airline growth in India is still in its infancy stage McKinsey suggests that half of India's highly qualified graduates are located in cities without international airports. Without massive change, infrastructure will not be able to handle growth. Airports in Delhi, Mumbai, Chennai, Kolkata and Bangalore are not adequate. Among them, Mumbai & Delhi are the worst: Service levels are not acceptable Delays are common And future growth cannot be accommodated Poaching due shortage of skilled manpower: 2006-2007 faced over 15 pilots & engineers poached from DKN alone - burning issueIndustry Losses Impact of Congestion: USD 80 million The year 2007 can be profitable for all the airlines in the Industry provided the government plays an active role in: Bringing the fuel prices down Regulating the newly privatized airports Driving the market with policies in terms of price and not regulations CHALLENGES Slide 14: 14 The projection for Indian Aviation for 2020 is estimated at: 400 million passengers Including 180 million domestic passengers 1,000 aircraft in the civil aviation sector Likely to follow the footholds of International Low Price Carriers e.g. Air Arabia, Southwest Airlines etc. More emphasis will be on Arabian and South-East Asian circuits. Future Trends : Passenger Forecast FUTURE TRENDS Slide 15: 15 Source : www.civilaviationweek.com WHERE DO I FIT IN PICTURE I will get a great career in this aviation industry as cabin crew . Because I have all those quality which is required by a cabin crew such as patience , hardwork , responsible Slide 16: HOW DID I BENIFITTED BY DOING THIS PROJECT It gave me the opportunity to understand this industry in better way . How this industry Work what are the problem faced by this industry . I got to know about various operator In India ,their working styles .different airlines of the world. A deep knowledge about History of airlines in India . Slide 17: Disadvantages The advantage is that you can almost alwaysget a flight to Europe. it uses the latest greatest technological advances to better the flight and our pleasure in travel There is a whole industry based on aviation that utilizes some of the latest technological advances in production and quality control. It is also a heavily governed industry so consumer safety for the most part is the highest for almost any industry in the world (some third world countries excluded). The aviation industry contributed £11.4 billion to the GDP in 2004 - that's 1.1% of the overall economy. It directly employed 186,000 people in 2004 and up to 520,000 indirectly. the industry contributed £3.6 billion to the Exchequer in 2004/05. Aviation plays a key role in trade. 55% of the export of manufactured goods to countries outside the EU is by air Tourism makes a large and growing contribution to the economy - nearly 4% of GDP The aviation industry is vital to our nationamp39s prosperity, and protecting this system from terrorist attacks or other dangerous acts remains an important ... The economic benefits of aviation are undisputable. The disadvantage is that aviation nterfereswith satellites. More chances of accidents due to bad weather conditions. if your airline goes out of business while your away somewhere, it can be difficult to get back home as the ticket you have is useless and you'll have to pay all over again to come home. The industry is so based on peoples travel habits and desire to travel that it can be up one year and terribly low another. If something goes wrong in the world this industry hurts fast. Demand drops, orders for newer aircraft drop etc. The most difficult barrier to entry into this industry in the Pacific Northwest is location. Most of the airlines are based on the east and gulf coast and with the rising price of jet fuel, many airlines are opting to send their planes to repair centers closer to their main quarters.” ADVANTAGES Slide 18: BIBLIOGRAPHY . http://civilaviation.nic.in http://www.skygod.com /quotes/ http://www.flykingfisher.com http://www.goindigo.in http://indiaaviation.aero http://www.wikipedia.org http://www.flyairdeccan.net http://www.goair.in http://www.spicejet.com http://www.hinduonline.com http://www.civilaviationweek.com http://www.businesstravelindia.com http://www.yahoo.com

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