Changing dynamics of Indian civil aviation sector (2015)

Abstract

It was a fine morning of December 2014 when Ankur Naresh & Rishi Bigghe were moving out of Bangalore for their hometowns after a hectic term-II at IIMB. They had reached well in advance fearing the Bangalore traffic & were waiting at the lounge of the international airport. Seeing a number of flights taking off & landing in the peak morning slot, the class lectures of operations management started flashing in their mind. They were excitedly discussing the turnaround times of different air carriers & the throughput rate of passengers from security check to flight boarding. The topic slowly deviated towards airline industry in India. Ankur was wondering that even though both of them had made reservations well in advance, the flight to his hometown Ranchi costed 1.5 times Rishi’s flight to Delhi (The air distance from Bangalore to Delhi is more than that to Ranchi). Rishi also reminded that Ankur’s flight would hop via Kolkata hub while he had a direct route. Meanwhile the departure board turning red with Air Asia colors drew their attention. “Are Tatas hedging between Low cost & full carrier strategy with simultaneous launch of Air Asia & Vistara?” Rishi quipped in. Ankur recalled how the Indian skies had undergone a sea of changes since the last 8-10 years. They had read a strategy case by Dr. Rishikesh in the last term which discussed the gradual evolution of Indian civil sector till 2008. Since then, a number of air carriers had shut down & the industry also witnessed many M&As. 2014 was gradually turning out to be an exciting year in Indian aviation with new players jumping into the market. Ankur & Rishi suddenly bumped into Professor Rejie George who was heading for a conference. After a brief exchange of pleasantries, they excitedly told professor about their morning observations and started discussing the changing dynamics of Indian civil aviation sector. The PA system soon announced the departure of professor’s flight. Professor Rejie hastened towards the boarding and said: “Why don’t you people explore this sector more in a CCS project? Let’s meet after semester break and see how we can take this forward”