Airlines India, Indian Airlines

Will the no frills Air India Express, which will commence its first international flight between Mangalore-Dubai on Tuesday, affect the prospects of airlines ferrying passengers between Mangalore-Mumbai? Will this development benefit passengers in terms of air fares?

Though the Dubai, Sharjah bound passenger traffic constitutes as much as 50 per cent of the total traffic of all airlines from here to Mumbai, the effect may not be pronounced in the initial stage, says Nagesh Shetty, area marketing manager, Indian here.

“In case the frequency of Air India Express flights is increased from the present three times a week to daily, the effect may be much more pronounced,” asserts Shetty.

But other airline operators do not seem to toe the line. “It is a hype which may not last for long,” says Pramod Nair, station manager of Jet Airways here. Nair said though there is no argument that it will wean away the low cost passenger traffic, which may constitute 20 per cent, the passengers who are accustomed to first class/business class will still prefer the slightly inconvenient Mumbai or Bangalore route.

Nagesh Shetty says this development will affect Indian also as 60 per cent of the traffic is Gulf bound. “It can be offset by the development the region will witness in a couple of years,’’ he said, pointing out at the IT Special Economic Zone (SEZ) and the Coastal SEZ projects, which are going to boost the overall economy of the region.

Sudhir Bhat, senior sales executive, IA, adds that though the traffic pertaining to Dubai, Sharjah sectors will see a drop, there are other sectors like Muscat, Kuwait, Bahrain which hold promise. Incidentally, sources says that Indian may also commence its flights to Dubai from here shortly.

Regarding the fares, Nair says the airlines are offering the lowest fare as of now and he fails to see a further drop in the rates. Shetty also agrees that the fares have hit rock bottom and the airline companies are just breaking even with sub Rs 3,200 fares on offer now to Mumbai.

Shetty sees tremendous opportunities for Mangalore due to the international flights arriving here. “Some medical professionals are planning to open up consultancy services in the Gulf. Also medical tourism can see a boost here,” Shetty asserts, adding that education sector will boom as people may send their wards here directly than getting them educated in the Gulf.

MEET THE FIRST PASSENGERS

Mangalore: Only two politicians will be on the first international flight, which will take off to Dubai at 9 pm from the Bajpe airport here on Tuesday.

BJP state president D V Sadananda Gowda and Surathkal MLA Krishna J Palemar will fly to Dubai and return on October 7. Palemar said he was happy that he was one of the first passengers to be on the inaugural flight.

Among those who will greet the inaugural flight are Union minister of state for civil aviation Praful Patel, Union minister Oscar Fernandes, Chief Minister H D Kumaraswamy, deputy CM B S Yediyurappa, V Thulsidas, chairman and MD, Air India, K Ramalingam, chairman, Airports Authority of India, K Rahman Khan, deputy chairman, rajya Sabha, Union minister of State for planning M V Rajashekaran, Union minister of state for transport K H Muniyappa. Also Patel will lay the foundation stone for the integrated terminal building of the airport on the same day.

M T Alva, officer customer services, Air India, who also will be on the flight, said that though the capacity of Boeing 737-800 is 185 seats, only 165 passengers will be there on the arrival flight and 174 on departure. Alva said this precaution was taken as the pay load of the airport was not ascertained as yet.

AIR INDIA EXPRESS, India’s only International budget airline and fully owned subsidiary of AIR INDIA is happy to announce the schedule for direct flights between Mangalore and Dubai, as well as, flights between Amritsar, Delhi and Dubai.

The inaugural flight on 3rd October 2006, will commence at Delhi proceed to Amritsar and onwards to Dubai. On the same day operations between Mangalore and Dubai will start. Special inaugural fares are being offered for a limited period.

Effective 5th October 2006, there will be three weekly frequencies each between Amritsar, Delhi, Mangalore and Dubai. Departures from India will be every Monday, Thursday and Saturday as follows: (all times local)

DELHI/AMRITSAR to DUBAI and return

Delhi Departure 0910, Amritsar departure 1125 Dubai arrival 1310

The return flight will depart Dubai on every Tuesday, Thursday and Sunday as follows: Dubai Departure 0001; Amritsar arrival 0430; Delhi arrival 0645.

MANGALORE to DUBAI and return – every Monday, Thursday and Saturday

Mangalore departure 2100 –Dubai arrival 2300

Dubai departure 1410 –Mangalore arrival 1910

Air India Express now operates 41 flights per week between Amritsar, Delhi, Mangalore, Kozhikode, Kochi and Thiruvananthapuram and Muscat, Salalah, Dubai, Sharjah, Abu Dhabi and Al Ain.

The flights will be operated by Boeing 737-800 aircraft in an all Economy version.

Air India Express (AIE), the low cost airline operated by Air India, will start flights to Bahrain next summer and not this October as was announced earlier.

“There is no question of AIE coming to Bahrain before the next summer season,” Dubai-based Regional Director (Gulf) for Air India Sanjeev Talwar said.

He cited the shortage of aircraft and “diversion of planes to other lucrative routes” as the reason behind the move, according to a media report.

“As much as we would want more and more destinations to be covered by the budget arm of Air-India, this is not possible in the immediate future,” Talwar said.

The airline was first expected to fly in to Bahrain in April last year when it was reported the first flight would land only in winter, the Gulf Daily News reported.

The load factor, indicating occupancy, of Air India Express flights from Kerala to Dubai and Abu Dhabi, among other destinations in the Gulf, was more than 90 per cent.

Flights from Delhi and Mumbai to the same destinations had reported less than 50 per cent load factor.

AIE began services last year, and flies to Dubai, Abu Dhabi, Muscat, and Salalah, from Kozhikode, Kochi, Thiruvananthapuram, Mumbai, Delhi, Amritsar and Mangalore.

Weighed down by surging jet fuel prices, Air-India’s net profit plunged by a huge 82.54 per cent at Rs 16.29 crore for the year 2005-06. The net profit for the year 2004-05 was Rs 93.31 crore. Fuel constituted a third of the airline’s total cost.

The fuel bill of Air-India, including its subsidiary which runs low-cost carrier Air-India Express, shot up by 43.62 per cent during the last financial year at Rs 3,134 crore against Rs 2,182 crore during 2004-05.

Company sources said the loss due to higher aviation turbine fuel (ATF) prices was in excess of Rs 650 crore. Total revenue from operations grew 25 per cent at Rs 9,677 crore for the last financial year, against Rs 7,751 crore in 2004-05.

“Air-India is slated to surpass the Rs 10,000 crore mark in this financial year with current expansion programme,” sources said. However, with the rise in jet fuel prices, total expenditure too grew 25 per cent at Rs 9,660 crore during the year under review compared with Rs 7,610 crore during 2004-05.

To curb adverse impact of its fuel bill, the airline has extended its hedging limits from 10 per cent of its international uplifts to 25 per cent.

“This will give flexibility to the company to hedge up to 75,000 barrels a day, up from the current limit of 30,000 barrels. However, the total number of barrels to be hedged will be limited to 7,50,000 a quarter,” said S Venkat, company secretary.

The wage bill, too, had adverse affect on the airline’s operation. It constituted 11.20 per cent of the total expenses of Air-India. The total wage bill for 2005-06 stood at Rs 1,055 crore, much higher than Rs 977 crore in the earlier financial year.

Sources said high crew salary, navigational cost, landing and handling charges had also impacted the operations of the airline.

Air-India entered into a purchase agreement with US-based aircraft manufacturer Boeing for acquiring 68 aircraft at a listed price of $11 billion. The airline is also readying for a merger with Indian.

AIR India Express (AIE), the low cost airline operated by Air India, will be introduced in Bahrain next summer and not this October as previously announced, said a senior official.

“There is no question of AIE coming to Bahrain before the next summer season,” Dubai-based Regional Director (Gulf) for Air-India Sanjeev Talwar told the GDN.

He cited the shortage of aircraft and ‘diversion of planes to other lucrative routes’ as the reason behind the move.

“As much as we would want more and more destinations to be covered by the budget arm of Air-India, this is not possible in the immediate future.”

The airline was first expected to fly in to Bahrain in April last year when it was reported the first flight would land only in winter.

This schedule was again revised to happen with the advent of the summer this year.

“After it failed to meet this year’s summer deadline, we had been reasonably sure it would finally happen in October to coincide with the winter schedule,” said Air India’s manager for Bahrain and Jordan M N Naik.

“This is also apparently not happening now.”

Meanwhile, an Air India official, speaking from Mumbai, told the GDN that Mumbai and Delhi might not even be connected from Bahrain even after the AIE starts operations, possibly in the summer of next year.

“The routes are simply not profitable and we will concentrate only on the South Indian market (Kerala) because that is where the loads are,” said the official.

He said while Air India Express flights from points in Kerala to Dubai and Abu Dhabi, among other destinations in the Gulf, had a load factor of more than 90 per cent, those from Delhi and Mumbai to the same destinations had reported less than 50pc.

“The same, we expect, will be from Bahrain,” said the official.

AIE began services last year, and flies to Dubai, Abu Dhabi, Muscat, and Salalah, from Kozhikode, Kochi, Thiruvananthapuram, Mumbai, Delhi, Amritsar and Mangalore.