Sucheta Dalal :Pilots’ strike: Everyone's benefitting except the affected airline
Sucheta Dalal

Click here for FREE MEMBERSHIP to Moneylife Foundation which entitles you to:
• Access to information on investment issues

• Invitations to attend free workshops on financial literacy
• Grievance redressal

 

MoneyLife
You are here: Home » What's New » Pilots’ strike: Everyone's benefitting except the affected airline
                       Previous           Next

Pilots’ strike: Everyone's benefitting except the affected airline  

October 5, 2009

 

Given the turmoil and sudden strikes in the airlines industry, operators offering alternate services like flight pools are witnessing a surge in demand. Not to be left behind, even the Indian Railways tried its hand to woo passengers stranded during the Air India pilots’ strike.
 
The strike by Jet Airways pilots which lasted for about five days in September, proved costly for the airline resulting in a loss of about Rs2 billion. Jet Airways carries around 24,000 passengers and its revenues are in the range of about Rs400 million, per day.
 
Air India, the national carrier, has been a loss-making entity for years. During the full year to end-March, the carrier posted a loss of over Rs50 billion and had to seek a bailout from the Union government. According to the Federation of Indian Airlines, during the 12 months to end-March, the domestic carrier suffered a loss of Rs100 billion.
 
Last month, during the Jet Airways pilot's strike that lasted for five days, Airnetz Aviation Pvt Ltd's unit Airnetz Charter operated around four flights with 30 bookings, compared with just one flight a week in normal course. Similarly, during the Air India pilots’ strike, the flight pool service provider had six bookings. Majority of these flight pools were on the Mumbai-Pune and the Mumbai-Ahmedabad route, Airnetz said.
 
During the airlines strike, flight pool services are required by business and first class passengers coming from international destinations having their connecting flights on the affected airline, said Omkar Mistry, chief operating officer, AirnetzCharter.com, in a release.
 
On an average, the company operates around 15 flights a month, out of which four are flight pools. Typically, travelling on a flight pool basis would cost you 30% to 40% premium than your business class ticket on any airline. The 40% premium becomes a profitable option during crisis times, as fares for bookings on other airlines also shoot up considerably.
With Air India pilots' agitation resulting in cancellation of flights, especially from Delhi, private airlines like Indigo, Jet Konnect, Kingfisher Red and JetLite were reported to be operating with a full load. Many passengers cancelled Air India bookings and preferred private airlines on Delhi and Mumbai routes, during the crisis.
 
According to media reports, Indigo's newly introduced flights to New Delhi, reported about 80% load factor while JetLite's flights to Mumbai were also operated with almost the same load factor.
 
The Indian Railways too has tried to cash in on this opportunity. During the Air India pilots strike, the Indian Railways set up train passenger reservation counters at all important airports throughout the country for the convenience of stranded passengers who wanted to travel by train. –Yogesh Sapkale with Amritha Pillay  [email protected]

-- Sucheta Dalal



 



Recent Comments