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Singapore Airlines Struggling in Indian Market
People, Travel

Singapore Airlines Struggling in Indian Market

Singapore Airlines Ltd’s premium Indian carrier Vistara has resorted to free tickets as intense competition and low fares add to the task of wooing passengers.

Vistara, jointly owned by Singapore Airlines and Tata Sons Ltd., filled about 59 percent of seats on average in the first half of 2015, government data show. That is the least of eight major passenger carriers operating in Asia’s third-largest economy.

SpiceJet Ltd., which last year offered base fares as low as 1 rupee (2 cents), filled more than 87 percent, Bloomberg reported.

Vistara on Aug. 12 offered a free premium economy class ticket—a tier it pioneered in the domestic Indian market—with every business class ticket purchased. Vistara did not comment on whether the move is aimed at filling more seats.

Given Vistara’s three-class configuration of business, premium economy and economy, “it’s too simplistic to look at the load factors relative to airlines with a single class, high density configuration of 180 plus seats,” Chief Commercial Officer Giam Ming Toh said in emailed responses to questions.

“Indian companies are already adding Vistara’s premium economy as an option in their employee travel policies. Its load factor rose to 71 percent in May from 53 percent in March.”

Giam said the airline’s fleet will expand to nine from six in the next three months.

“Vistara will continue to see near-term pressure on premium-economy yields,” said Kapil Kaul, South Asia chief executive officer for Sydney-based CAPA Center for Aviation.

“Making premium economy work is critical. Otherwise, a configuration correction will become necessary.”

 

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