Aviation Industry
1.Overview
1.Overview
Indian aviation industry is growing at 17% rate for the last few years with more than 40 million passengers have travelled in domestic sectors and more than 20 million passengers have travelled in international sectors in India in 2008. The number of airports in India has also been increased significantly with 15 international airports, 87 domestic airports, 27 civil enclaves and more than 300 small airstrips. Also air cargo is growing at a rate of 13%-14% and contributes around 0.2% of India"s GDP. Besides the year old public company Air India the major private players operating in Indian market are Jet Airways, Kingfishers, Spice Jet, Indigo, Paramount, Go Air etc. Among this Kingfisher has the largest market share of 21% closely followed by Jet Airways with 19.5% market share. Indian airline have maintained a seat factor of 70% to 80% in 2009.
2.SWOT Analysis
2.1Strengths
Opening of domestic aviation sector to private airlines and strong economic growth are the major reasons for rapid growth in aviation sector. Also as Indian aviation industry is relatively new, the planes are relatively new which results in better operational efficiency, passenger comfort and longer lifetime.
2.2Weakness
Despite rapid growth and entrants of several new players there are certain issues which are haunting aviation sector till now. One of them is the deficiencies of airport infrastructure across the country. Nearly all the major airports in India are heavily congested and operating environments too are inefficient. Though recently new airports built in Bangalore and Hyderabad and modernization of Delhi and Mumbai airports have result in relatively better airport infrastructure. Also most of airlines have not been able to break even till now. Unless they achieve profitability within a short time period some of these airlines will find it difficult to compete in this competitive market. Another big obstacle to reaching profitability for Indian airlines is the high fuel cost. Due to high sales tax the fuel cost for airlines is sometimes 60% higher than international price. The rapid growth has also been resulted in scarcity of resources particularly for pilots, technical people, management people and airlines have to depend on the expats which costs them heavily. Also India does not have high quality training institutes which can generate required number of pilots or technical people.
2.3Opportunities
Indian aviation industry is still in nascent stage and further economic growth will increase both number of passengers opting for air travels as well as cargo transported through airlines. Also India is slowing becoming a tourist destination and the number of foreign national coming to India for both tourism and business activities are increasing. India"s geographical position is also very suitable for it to become an aviation hub at the cross roads between Europe/ Middle East and Asia pacific. Also increasing outsourcing of aerospace design and manufacturing to India has been resulted in creation of domestic talents which can be utilized to grow Indian aviation sector.
2.4Threats
One of the biggest threats to Indian airlines particularly in the international segments is the entrant of more matured and cost effective foreign airlines. Also the security issues sometimes become matter of concern to the air traffics particularly in the international segment.
3.Government Policies
With the adaptation of open-sky policy and allowing air-taxi operators to operate flights from any airport, both on a charter and non-charter basis and to decide their own flight schedules, cargo and passenger fares Indian government has started the reform of Indian aviation industry. In 1994 private operators are allowed to provide air transport services. FDI up to 49% equity stake and NRI investment up to 100% equity stake through automatic are allowed in aviation sector. But foreign airlines are barred in investing in domestic airline company directly or indirectly. Also Indian airlines are allowed to start international operation after 5 years of their operations. Currently Kingfishers and Jet Airways are the two private airlines who have international operation.
4.Low Cost Carriers
One of the unique results of adoption of open-sky policy by Indian government is the introduction of low cost carriers. By taking several measures these carriers are able to reduce their cost of operation and pass the savings to the customers. Few unique characteristics of these low cost airlines are
"The plane has a single passenger class (most of the cased economic class) resulting in better utilization of plane area
"The companies go for single type of planes resulting in lower training and servicing cost
"They fly in early in the morning or late in the evening to avoid air traffic delay and take advantage of lower landing fees
"They opt for point-to-point transit instead of transfer at hubs to increase aircraft utilization and eliminating disruption delayed passengers or luggage
"They replace free in-flight caterings and other complementary services with paid service
"They allow advertisement, sale inside airlines to generate revenue from other sources
"These airlines encourage e-ticketing or selling of ticket through direct agents to avoid fees and commissions paid to the travel agents
5.Career In Aviation Industry
A student can choose any of the above
aviation courses, according to his interests. The level of course applied for also depends on the qualifications and academic background of the students and admission procedures and qualification required vary according to the course chosen and the college applied in. Also, looking at the demand of this course in students, with the growth of the aviation and tourism industry, many colleges have opened pan India, to provide studies in the same.
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