Jet Konnect to fly on metro routes
Despite the drop in yield, revenues are on the positive side, another company official, who also did not wish to be identified, said.The airfare gap between a full-service and a budget airline has widened again to 30-35 percent level, following a sharp fall in jetfuel price. This has led to air-travellers moving away from full-fare to low-cost carriers. Incidentally the two major budget carriers IndiGo and SpiceJet have significantly improved their market share in the past one year.
The combined market share of the two airlines increased to 26.2 percent in August this year from 18.8 percent in the corresponding month last year. All the full-service carriers are now focusing on no-frill air service. While Kingfisher Airlines has shifted about 65 percent of its capacity to Kingfisher Red, Air India is gearing up to launch its budget airline Air India Express in the domestic market.
Corporate travellers have moved to economy class since the downturn in the economy, the Jet official said. He highlighted that companies had also cut down their travel budgets. Now, even the government had embarked on a major austerity drive and has asked officials to travel only economy class. The market is clearly moving towards low-cost air travel, he said