Bubble in the sky?

Thanks to this business standard article – IndiGo opens new flank in fare war – I learnt yesterday that:

… a Delhi-Kolkata ticket on a IndiGo flight will be just Rs 1,399 compared with an average low-cost ticket of Rs 3,500.

Similarly, a Delhi-Chennai ticket will be for Rs 1,299 compared with an average low-cost fare of Rs 2,500. The offer, which is introductory now …

Then I read that Kingfisher plans to buy 5 A380s fully aware that today, our country does not have a single airport ready to handle that aircraft.

And on Business Standard site itself, I read this nicely written summary on the situation: Heavy weather flying. Saving myself an extensive quote job here, let me say that I agree with the author.

It is definitely exciting to see the boom and dropping airfares. But “profitless growth” is something we saw during the dotcom bubble as well. While rides here are not free like in that bubble, they are a bit too cheap to be real. Recently, I posed this question to Deccan, Kingfisher and Indian Airlines staffers at Bangalore airport and they whispered that Spicejet is losing an unbelievable amount of money each day.

Booked over a week in advance, Bangalore-Pune costs me Rs 2400 on Spicejet, and 4000 on Jet. In similar situations, I did Bangalore-Kolkata for 3200 on Deccan, and 5000 on Jet. If Spicejet is really 35% cost efficient over Jet, then I hope they open Spice-Marts as well!

The industry is expecting a mobile-phone-subscribers like surge, but sorry, 25% isn’t that exciting. Welcome IndiGo, but I foresee an aviation bust in the short term before R K Laxman’s common man starts flying.

PS: Having flown Deccan, Spicejet, GoAir, Kingfisher and the rest, I will tell you that Spicejet is currently the best airline in our country. Low cost, yet neither late nor chaotic. Spicejet almost matches, even beats Deccan on the sectors I have flown, and yet, provides better experience in form of newer/cleaner aircrafts, much better legroom, at least water and biscuits served inflight and a lot better punctuality than Deccan.

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2 Responses

  1. I was a bit perplexed by the fact that I was totally ignored by the crew on a recent GoAir flight from Bangalore to Hyderabad… was it my conspicuous whiteness? They served all of the Indians aboard…

  2. Peter: Surprised to hear that. I usually notice the reverse. Out here, whiteness attracts preferential treatment and service, everywhere and almost always. Colonial hangover of sorts.

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