The Naresh Goyal-controlled Jet Airways, the country's largest private sector domestic carrier, has shelved expansion plans even as rivals Air Sahara and Indian Airlines have announced large fleet expansion plans.

Speaking with Business Standard, Saroj Datta, executive director of Jet Airways, said, "We are stabilising our operations during the current financial year. Our expansion plans, in future, would be based on the economic viability and would also depend on how the market develops during the year."

According to Datta, the special fares under various schemes (like the advance purchase fares) introduced by the domestic carriers during the last year have taken a toll on the yields. Datta declined to comment on the current yield but sources said that yields have dropped by over $5-6 per passenger.

"While the average load factor has stagnated at around 60-65 per cent, the existing overcapacity situation has left no room for expansion plan in the near future," Datta added.

Jet has been working on a fleet expansion plan, which has been kept under wraps till now. It is now evaluating a route rationalisation plan instead based on which its may withdraw or reduce frequencies in some sectors.

Jet has a fleet comprising of 40 aircraft (30 Boeing 737 and 8 ATRs). A flurry of low-cost airlines like Air Deccan, Visa Airways, Jackson Airlines waiting to take off may change the market dynamics.

Goyal's dream to see Jet servicing the international routes, which would depend on the new civil aviation policy, has not received a government nod.

Industry analysts said that the mega capacity expansion by Air Sahara in its bid to acquire size and market share may compel other airlines to review their expansion plans.

Recently, Air Sahara, after having eaten into the market share of both Indian Airlines and Jet Airways, announced a plan to treble fleet size.

IA has also plans to acquire 43 new aircraft for Rs 10,000 crore (Rs 100 billion).