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Packed flights on Indo-US sector

By Ravi Teja Sharma in New Delhi
August 22, 2007 13:15 IST
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Planning a visit to the US in the coming days and looking at booking a direct flight? It's best to wait. All direct flights on the India-US sector are going choc-a-bloc - be it business or economy class - and there appears to be no respite in sight. Add to this, is the pressure from the growing student traffic as sessions at most US universities begin in September.

Confirms Nisha Maharaj, regional manager, Indian subcontinent, American Airlines, "American Airlines is pretty much booked till September-end and it would be difficult to get seats even on business class."

Ankush Nijhawan, MD, Nijhawan Group, however, begs to differ. According to him, tickets are definitely available on this route, but the fares tend to be on the higher side at this point in time. This, he says, is partly due to the student rush, a trend that repeats during December-January months.

Explains Kapil Kaul, CEO, Indian subcontinent & Middle East, Centre for Asia Pacific Aviation, "There are different classes of fares. And since all seats on the lowest fare slab get taken first, the fares seem expensive at the moment."

The direct carriers between India and the US include Continental Airlines, Delta Airlines and Air India, apart from American Airlines. Air India recently started its non-stop service between Mumbai and New York and quite a few dates on Continental are going full.

"Historically speaking, August is a very strong month," says Laurent Recoura, senior country director-India, Continental Airlines.

He is, however, quick to add: "But, traditional trends on this route are changing dramatically. Earlier, summer breaks and winter were peak traffic seasons. Now, there is a peak all the year round. In that sense, the summer and winter seasons are the peaks of the peak."

He checks out for us the economy fares for Continental on August 29 (Rs 66,840) and September 20 (Rs 42,840). According to him, the yield management system fixes the fares depending on demand and supply. The closer to the date you book your flight, the higher the fare you get (quite similar to what happens on domestic flights nowadays).

As of now, the load factor on Jet Airways' Delhi- and Mumbai-Brussels-Newark flight is doing extremely well. According to industry sources, the average load factor for these flights has been over 85 per cent for the last one month and they expect it to touch about 85-90 per cent for the next one month. Many Jet flights are going full and even their premier and first class are seeing high load factors.

The demand on this route is surely going strong. According to CAPA, there has been a 40-50 per cent growth in traffic on this route in the last five to six months. "Demand on this sector would shock everyone. We expect a 30-40 per cent growth on this route every year," he stresses.

Overall bouyancy in the market is also expected to increase. Kaul says that if the nuclear deal between India and the US goes through, there will be a huge increase in traffic. "The by-product of this deal will increased traffic. Investments from the US into India will jump and so will business traffic on the whole," he says.

The biggest indicator of this growth in demand in this sector is the new flights many carriers are planning on this route. Continental will be adding another point in October. Recoura tells us that they will start a Mumbai-New York non-stop from October 2. It will be four times-a-week to start with but will gradually become a daily in November.

At the moment, Continental has 1,953 seats a week, a number that would double with the new flight in November. Jet, too, is planning new flights this winter. They are planning a flight to San Francisco via Shanghai and another from Chennai via Brussels to the US.

Kaul feels that prices on the India-US route are already very low. All carriers plan to put a larger premium on higher-class seats, which would be the key to success on this route. In fact, says Kaul, Kingfisher is planning a game, changing product in its first and business class when they fly this route.

At the moment, he says, Indian carriers on this route stand at an advantage. Jet, for example, has a huge domestic network, which would add to its strength. It will be the same for Air India after its merger with Indian. But as of now, there is no option for the consumers but to go along with the flow.

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Ravi Teja Sharma in New Delhi
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