Air India planning budget flights to US

With Malaysia-based Air Asia proposing to start a low-cost global airline, Air-India may look at long-haul budget carriers following the success of its subsidiary, Air India Express. “We are open to the idea of flying a low-cost airline to Europe and the US ... Who knows, it might catch on in future and we would like to gear up to meet such a demand,” Air-India chairman V. Thulasidas said. Air Asia, which offers fares equivalent to Rs 700 between two South Asian destinations, proposes to offer flights to Europe from Asia for as low a price as $100, revolutionising long-haul travel. Taking a cue from this, Air-India is now mulling a budget airline to Europe and the US, Thulasidas said, adding that the national carrier now has low-cost flights to several destinations in West Asia from a number of cities in India and between Chennai and Singapore. Barring Dubai, where Air-India operates both budget flights and regular ones with business and first-class categories, the airline does not operate regular flights to other destinations in West Asia.

Thulasidas, however, said that “as of now, there are no concrete plans”. If Air-India decides to go ahead with its plans for a low-cost long-haul international budget airline, this will be a first-of-its-kind venture by an Indian air-carrier. So far, low-cost or no-frills airlines have been operating solely in the domestic sector. The financial performance of these airlines have not been rosy so far with most of them struggling to break even. It was only in the third quarter of this fiscal that Air Deccan posted a net profit. Others, such as SpiceJet, GoAir and Paramount will take at least another year to enter the black. Against this backdrop, the business model would assume prime importance and it remains to be seen what business model the country’s international flag-carrier comes up with. Air-India, will, however have the advantage of learning from the experience of Air Asia should it decide to carry forward its plan for an international budget airline. Air Asia is pushing for launching its Malaysia-Britain service in July. Another Hong Kong-based airline, Oasis has big plans in this segment.

visit us @ http://www.silkrouteholidays.com