Air travel falls 1.8% in June

Last Updated: Sat, Jul 20, 2013 05:55 hrs

After increasing in May, air traffic declined 1.8 per cent in June. Domestic airlines carried about five million passengers during the month, compared with 5.1 million passengers in June 2012.

The April-June quarter is considered a good travel season, as it coincides with school and college holidays. In April, air travel had registered a drop of 0.4 per cent, before increasing 4.8 per cent in May.

In June, overall demand slipped 6.7 per cent, while modest growth in capacity was recorded. IndiGo maintained its leadership position, with 29.5 per cent market share. Jet Airways, along with its subsidiary Jet Konnect, retained the second spot with 23.1 per cent share, followed by SpiceJet (19.5 per cent), Air India (18.9 per cent) and GoAir (8.9 per cent). "Usually, travel demand tapers in June-end/early July, as schools reopen. We witness demand slowing during this period," said Manmeet Ahluwalia, marketing head of online portal Expedia. To raise volumes, domestic airlines are offering incentives and discounts, as traffic slows in the July-September quarter. While most airlines are offering lower fares for 30-60 day advance bookings, Jet Airways is offering discounts through select agents. Industry sources say the carrier is offering discounts to increase market share and boost forward bookings.

"Jet Airways' market share has fallen over the last few months… the collapse of Kingfisher has helped other low-cost airlines gain the most. Now, even GoAir has a share of about nine per cent, while on a standalone basis (excluding Jet Konnect), Jet's market share is lower than SpiceJet's. The discount fares would boost sales. This is also aimed at restoring confidence among the travel agents who had been protesting about the reduction in commission, as well as other issues," a source said.

Earlier, Giorgio De Roni, chief executive of GoAir, had told Business Standard the airline had slashed fares to boost demand. "Air traffic movement was good in the first half of June; demand slowed in the second half because of the monsoons. On certain routes, we are offering tickets at half the price to boost load factor," De Roni had said.

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