Praveena Sharma

Bangalore: In a minor trend reversal, legacy carriers Indian, Jet Airways and JetLite (formerly Air Sahara) regained some of their lost market share in February even as the challenger airlines (except for Deccan and SpiceJet) saw their share in the aviation pie shrink.

Not long ago — between 2005 and 2007 — the new entrants had challenged legacy carriers by growing their market at a furious pace. This had diminished the legacy carriers’ dominant position in the market even though they were flying more passengers than before.

It may be a flash in the pan, but February, which is traditionally a lean month for air traffic, saw the incumbents regain some lost ground.

Analysts attribute the trend to the ongoing consolidation in the market.

“Jet and JetLite are seeing some benefits of consolidation. They’ve also corrected their fares. That could be the reason why they were the only ones who saw their passenger load factor go up in February, while others saw theirs dip,” said an analyst.

State-owned Indian’s share in the aviation pie grew 50 basis points (bps) at 14.40% from 13.90% in January. However, this was still down 160 bps from 16% in February last year.

Naresh Goyal’s airlines - Jet and JetLite - also bit off bigger pieces of the market in February at 23.20% and 7.40%, up 50 bps and 57 bps, respectively over January.

Both airlines, however, will need some more thrust to reach their last year’s market share figure of 25% (Jet) and 8% (JetLite), respectively.

On the other hand, challenger airlines (barring Deccan and SpiceJet) saw their pie shrink.

Vijay Mallay’s Kingfisher Air had seen its market share jump 450 bps year-on-year in January. But, it lost some thrust in February with its share skidding to 14.20% from 15.36% in January.

YoY, though, its pie has swollen 420 bps during February.

Surprised at the dip in Kingfisher Air’s share, a senior budget airline official said it could be due to lower seat load factor or lower deployment of capacity into the market.

Deccan, the budget carrier acquired by Mallya,which has been consistently losing market share, recovered some ground in February as its share inched up 19 bps to 14.60% from 14.40% in January.

In February last year, Capt G R Gopinath, Deccan’s previous owner had taken the low cost airline’s share up to 21.7% as he pursued aggressive market expansion through heavily discounted fares.

Like Deccan, SpiceJet also maintained its altitude in February with the share growing by 11 bps at 10.60%.

Other challenger airlines also lost market share in February — IndiGo down 93 bps at 9.90%, GoAir down 50 bps at 4.40% and Paramount down 5 bps at 1.20%, respectively.

Source : DNA