Aviation Strategy

Strategic planning is a continual process for airlines.
Plans must take into

account the challenging and ever-changing competitive environment as well as
how passengers define value. For example, business travellers are sensitive to
flight times and expect a high level of service. Short haul business travellers tend
to be more sensitive to ticket prices than long-haul business travellers. Leisure
travellers are more sensitive to price but less demanding about service levels.
Deregulation has had a significant impact on airline strategies during the past
several decades. As regulations on commercial aviation relax, airlines gain
freedom to vary fares in response to competition and demand, develop network
and schedule planning, and manage other key aspects of airline business.
Deregulation has helped stimulate traffic and network growth, and the resulting
competition provides increased choice to travellers. Airline business models
continue to evolve in order to adapt to the dynamic marketplace.
In the contemporary airway market where an intensive competition takes place,
the task of keeping the customers loyal has become a vital process for sustaining
the existence of companies and their profits. As a result of the strict competition,
company managers began to implement different strategies to cope with other
competitors and increase customer satisfaction through improved service quality.
STRATEGIC GROUPS
Full range carriers with medium price:
Wide coverage of services provided and have greatest potential to capture and
can lead in market. But have less number of International destinations and the
new comers can come up with low fares.
Low cost carriers with low price :
Great facilities and technology but no service for economic class.
Very high service with high price :
Better service due to high fare and Attractive for the growing middle class. But
less coverage within country.
Good service with medium price :
Low fare as compared to higher service provider. Better services than LCC.
Targeting to the middle class customers.
The civil aviation sector in India has moved into a new era of expansion. Some
major factors contributing to this are:
- Higher household incomes -Strong economic growth - Entry of low cost carriers
(LCC) -Increased FDI inflows in domestic airlines - Increased tourist inflow -
Surging cargo movement - Cutting edge information technology (IT)
interventions - Focus on regional connectivity - Modern airports - Sustained
business growth and - Supporting Government policies.
Strategies of different airlines:
INDIGO:
IndiGo has made sure that its average fleet age remains four years till 2032.
IndiGos bulk buying helped negotiate better rates. The company bought
planes at a lower price than what a seller would buy for.
IndiGo is planning to increase its presence in the number of cities it flies to
adding two to three cities to its portfolio every year. In the next eight and half
years it plans to have presence in 56 airports compared to 33, now. Regional
flying is not on the radar, and neither are smaller planes. We do not have any
plans to induct smaller planes into our fleet. Nobody in this world has been
able to implement a two-model strategy.
SPICEJET:
As SpiceJet Ltd, Indias second largest low budget airline, tries to revive its
business after tiding over a financial crisis last year, its new strategy is to
try and connect to travellers through events rather than prices.
On Valentines Day, SpiceJet offered a We Love You With All Our Heart
sale. Holi was marked by a Spreading Colour in the Sky sale. And now
there is the TravelTuesday, which offers special low fares on Tuesdays.
There is also the Cheaper Than Train Fares branding for those who may
still prefer a train journey.
SpiceJets new communication strategy follows a trend set by a number of

global airlines that introduced unconventional and trendy branding and
entertainment initiatives.
JET:
Jet Airways had the lowest-cost quarter boosting its profit. The jet fuel
expenses for Jet Airways for the reporting quarter was at Rs.1,235.36 crore
against Rs.1,701.07 crore for the corresponding quarter of the previous
year, registering a 27.37% decline.
Focus on operational efficiencies was starting to show results for Jet

Airways. The airline has registered one of the highest aircraft utilisation at
over 13 hours on the Boeing B737 planes.
Airplane utilization is a key performance indicator for airline operations

and a significant differentiator for domestic airlines.Jet Airways posted
aircraft utilisation of 12.7 hours a day for the December quarter, up 9.48%
against 11.6 hours a day for the corresponding quarter of the previous
year.
The strategy of Jet Airways was not adding new aircraft but increasing
available seat kilometres (ASKM) with the existing fleet. Jet Airways had
12,617 million ASKMs for the December quarter, up 10.99%.
Ruthless cost cutting. Lower CASK (cost per available seat kilometre),
excluding fuel. CASK, one of the key competitive dynamics, for Jet Airways
was at Rs.3.20 for the third quarter of the current fiscal against Rs.3.36 in
the year-ago period.
Jet Airways has adopted a ruthless network redesign to drop poor routes
and add good ones.
GOAIR:
GoAir plans to hire 500 personnel, including pilots, as the budget airline
prepares to expand its aircraft fleet and fly overseas.
Gearing up to implement its ambitious expansion plans, airline is looking

to have 26 aircraft by end of March from the current fleet strength of 21.
GoAir got governments approval to fly to nine countries including Iran,

Uzbekistan and Kazakhastan. It expects to start international operations
from the summer schedule -- which generally spans from the last Sunday
of March and extends to the last Saturday of October.
GoAir would be the first Indian private airline to fly to any CIS
(Commonwealth of Independent States). CIS countries for which the
airline has got flying nod include Uzbekistan, Kazakhastan and Azerbaijan.
http://economictimes.indiatimes.com/industry/transportation/airlines-/-
aviation/check-out-the-best-worst-airlines-in-india

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Strategic planning is a continual process for airlines.

Plans must take into

Low cost carriers with low price :

Great facilities and technology but no service for economic class.

Very high service with high price :

Good service with medium price :

SpiceJets new communication strategy follows a trend set by a number of

Focus on operational efficiencies was starting to show results for Jet

Airplane utilization is a key performance indicator for airline operations

Gearing up to implement its ambitious expansion plans, airline is looking

GoAir got governments approval to fly to nine countries including Iran,

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