State-owned Air India has postponed deploying its new Dreamliner aircraft on the Delhi-Sydney-Melbourne route, one of the largest unserved ones, till the first quarter of 2013.
The earlier plan was to start from October, a month after Boeing began delivering the much-awaited planes.
Instead AI is flying these to Frankfurt, Dubai and and some domestic destinations.
The India-Australia route doesn't have even a single non-stop flight from either an Indian or Australian carrier, despite the Air Service Agreement between the two countries permitting 6,500 seats a week and access to 10 cities.
The delay is another boost to foreign carriers such as Singapore Airlines and Malaysian Airlines, which dominate this route. AI operated between India and Sydney until 1991.
It had filed for landing and take-off slots to operate Delhi-Sydney-Melbourne from October with the new planes, confirmed an executive. About the delay, the executive said, "With Australia being a tourist destination, the bookings for December were already over. That is why we are deploying the Dreamliner on other commercial routes."
More, arrival of the Dreamliner had already been delayed by some months. "The pilots need to practice for landings and takeoffs on any new aircraft. With all these delays, we had to also shift the timeline for the Sydney-Melbourne flight," the executive added.
While no Australian or Indian carriers operate non-stop services between the two countries, Qantas, Virgin Australia and Jet Airways serve the route through code-share arrangements.
Dreamliners are 25 per cent more fuel-efficient than similar-size Boeing 777s and are optimal for flights of 10-13 hours. After AI started to receive their delivery from September, it had said it would deploy these planes the India-Sydney route.
Said a recent report from the Centre for Asia Pacific Aviation (Capa): "India-Australia is a largely untapped market, with significant potential, considering the volume of trade, tourism and VFR (visiting friends and relatives) traffic between the two nations. Yet, it remains without direct air service from either country's carriers."
It explains this is because few aircraft types of the appropriate size are capable of non-stop service in both directions. Also, the sixth freedom (in aviation rules, referring to the carrying of passengers from India, hopping on to Singapore and then going to Australia) competition from carriers such as Singapore Airlines creates a high hurdle.
India's international carriers remain financially challenged, while Australia's Qantas is also suffering losses across its international network and is similarly focusing on profitable, higher-yielding markets.
At a Capa conference in Mumbai last month, Kerrie Mather, chief executive officer of Sydney Airport, said, "Sydney Airport estimates Indian visitor numbers to grow 16 per cent by 2020.
"India is currently Australia's largest unserved route and has enough demand to fill four daily direct services."
Whether AI is able to offer direct services on the India-Australia route even in April remains to be seen. Experts believe the lack of direct service between the two countries is limiting the potential, with long travel time and a stopover required.
Incidentally, Australia and India plan to double two-way trade to $40 billion by 2015.