Private carriers in India crashing down

Aviation in India has attracted entrepreneurs like moths to a flame but only a few have managed to survive and thrive in a sector which has become the graveyard of all kinds of airline business models − budget, full service and hybrid.

Kingfisher was one of the biggest private initiatives but it failed. Jet Airways, which is considered an iconic brand, has come crashing down. Before that, many airlines folded up within few years of their launch and initial success. Notable among these are East-West, ModiLuft, Damania Airways and Madurai-based Paramount Airways.

The reasons of closure ranged from rift with partners in case of ModiLuft to cash crunch and regulatory challenges.

The collapse of Jet Airways, which was the industry mascot not so long ago, is indicative of the larger menace in the system that has led to many private carriers down the path to oblivion.

So far, this full service airline had been the longest-running private carrier, having established itself as a formidable brand that is recognised internationally. At its peak, Jet operated a fleet of 124 aircraft till a few months ago. The sudden collapse of Jet Airways has come as a big surprise to many aviation experts as the airline had said just a year back that it would consider bidding for a stake in debt-laden Air India. A year is certainly a long time in aviation given that even a small shock can pull an airline down. India, however, is a different market and notorious for its high operating costs and low airfares.

“Fares offered by Indian carriers are among the lowest in the world. Even 10-15 years ago the fare was the same or even higher than today!” said Rajan Mehra, an aviation veteran.

Indo-Asian News Service