Low Cost Carries in India

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“CHALLENGES FACING LOW COST AIRLINES IN INDIA”

BY RANJIT SHERGILL MODULE CODE - AE3260 BSc(Honours) AIR TRANSPORT OPERATIONS PART 3 I declare that all work presented in this dissertation is my own work, and where applicable I have credited the work of others by stating the source of certain information in quotes. This project has been overseen by Mr S.K.Ramchandran who is the Regional Director for the Indian Airports Authority in Southern India, who has endorsed the views and the conclusions of my project, which are reflected in his article. [See Appendix 1]

PERSONAL STATEMENT At the beginning of this project I anticipated a very interesting and challenging title. India is a country close to my heart. Therefore investigating the Indian Aviation industry was of great significance to me, as currently I am a CPL holder with an Instrument Rating, and I aspire to be a pilot for an Indian carrier in the future. This project gave me a personal guide in what to expect working for an Indian airline. The current growth creates the opportunity for a very successful industry. However India is a country where lack of basic development, organisational and political issues presents the biggest challenges. Overall I have thoroughly enjoyed investigating the Indian airline industry and been thrilled to know what potential exists out there, and if the correct talent is utilised and managed well, the future looks bright, although overcoming the regulators and soaring fuel prices remains inescapable hurdles at present.

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SYNOPSIS The aim of this dissertation is to investigate the “Challenges facing Low Cost Airlines in the Indian Aviation Industry”. The Indian Aviation Industry is currently one of the most active in the world, with a number of new airlines looking to start up and aircraft orders increasing substantially. This presents many job opportunities for pilots and cabin crew across the world as well as ease of travel across India. The Author starts off by looking at the history of the Indian Aviation Industry. The Author then looks at the present day situation, with regards to the introduction of low cost airlines in 2003, and what effect this has had on the industry. With the aid of data collection, the Author shall be analysing why all the threats and challenges are present. This involves an examination of the current business models that the LCCs (Low Cost Carriers) use, and looking at the solutions and the steps that can be taken to minimise and perhaps eradicate the current threats and challenges. On conclusion the challenges facing LCCs in India, is high fuel prices, inadequate airport security and facilities, competition from the railways for government support and funds, poor airport infrastructure and punctuality, lack of well trained pilots, and supply exceeding demand leading to several airlines making consistently huge losses. These are just some of the many challenges that pose a threat to the longevity of the Indian LCCs. The general consensus appears to be the rapid growth of the industry, did not coincide with enough thought and planning going into it.

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CONTENTS
CHAPTER 1 - INTRODUCTION CHAPTER 2 - STATUS OF INDIA CHAPTER 3 - OVERVIEW OF LOW COST MARKET 3.1 3.2 3.3 3.4 Full Service Carriers vs. Low Cost Carriers Market Share of Low Cost Carriers Growth in traffic Future Growth PAGE 11-17 PAGE 5 PAGE 6-7 PAGE 8-10

CHAPTER 4 - MAJOR ISSUES IN INDIAN AVIATION AT PRESENT 4.1 4.2 4.3 4.4 4.5 Airport Infrastructure ATC Fuel Costs Regulations Dependence on Leased Aircraft

CHAPTER 5 - CASE STUDIES ON LOW COST CARRIERS 5.1 Air Deccan 5.2 Spicejet 5.3 GoAir CHAPTER 6 - CONCLUSION CHAPTER 7 - RECOMMENDATIONS DEFINTION OF ABBREVIATIONS REFERENCES APPENDICIES

PAGE 18-37

PAGE 38 PAGE 39-41 PAGE 42 PAGE 43-45 PAGE 46-51

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CHAPTER 1 - INTRODUCTION J.R.D Tata is the man who should be credited for starting the Indian...
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