EX­PLAINER

Car­rier’s de­ci­sion to realign some of its point-to-point flights has led to a spike in air­fares

Arabian Business English - - CONTENTS -

Jet Air­ways has de­cided to can­cel 40 flights on seven un­eco­nom­i­cal routes in the Ara­bian Gulf re­gion

What’s the story?

Jet Air­ways an­nounced last week it would can­cel up to 40 flights on seven Gulf routes. A spokesper­son for the In­dian car­rier told Ara­bian Busi­ness that the air­line is re­align­ing some of its point-to-point flights from cer­tain des­ti­na­tions in the Gulf, in­clud­ing Dubai, Abu Dhabi, Mus­cat and Doha, through its hubs in Mum­bai and Delhi. In­stead of a di­rect flight from Mus­cat to Tri­van­drum, for ex­am­ple, a pas­sen­ger will fly to Tri­van­drum from Mus­cat via Mum­bai, the spokesper­son said.

Why is it cut­ting the routes? The de­ci­sion fol­lows a re­view of the car­rier’s net­work that will see it move ca­pac­ity from un­eco­nom­i­cal routes to more prof­itable ones in or­der to align ca­pac­ity of­fered with the de­mand char­ac­ter­is­tics of spe­cific mar­kets, ac­cord­ing to the spokesper­son. “As part of this strat­egy, Gulf op­er­a­tions are be­ing op­ti­mised to fo­cus on con­nec­tiv­ity at our hubs in Mum­bai and Delhi in­stead of point-to-point con­nec­tiv­ity.”

Why are the routes un­vi­able?

Air fares and pas­sen­ger load fac­tors have been drop­ping in some of these Gulf routes, mak­ing these op­er­a­tions un­fea­si­ble for air­lines, Kin­jal Shah, avi­a­tion sec­tor ex­pert and vice pres­i­dent at ICRA, told Ara­bian Busi­ness. “With mount­ing losses in their op­er­a­tions in the re­cent quar­ter, In­dian car­ri­ers are tak­ing a hard look at many of the Gulf routes and knock­ing off routes which are un­vi­able.” She also said there could be flight can­cel­la­tions by air­lines from more des­ti­na­tions in the Gulf re­gion go­ing for­ward. “This will de­pend on the cost-re­turn anal­y­sis by each air­line,” she said. Have other In­dian air­lines an­nounced route cuts? Low-cost car­rier In­digo has also can­celled its flights from Mus­cat to Cali­cut and Chen­nai, but still op­er­ates ser­vices to Mum­bai, Kochi and Ahmed­abad. How­ever, aside from Jet Air­ways and In­digo, no other In­dian car­ri­ers have yet can­celled flights to any of the des­ti­na­tions in the Gulf re­gion.

How is this af­fect­ing trav­ellers? The can­cel­la­tions are caus­ing ma­jor headaches for tour op­er­a­tors in the re­gion. In­stead of di­rect flights, their pas­sen­gers now have to fly via Mum­bai or Delhi, lead­ing to pos­si­ble ad­di­tional costs. “The Christ­mas and New Year sea­son is one of the busiest for us in terms of our tour op­er­a­tions to some of the Gulf coun­tries,” Abra­ham Ge­orge, MD of Kochi-based In­ter­sight Tours & Trav­els, said. “The sud­den with­drawal of flights from some of these routes has put us in se­ri­ous in­con­ve­nience, be­sides jeop­ar­dis­ing our cost cal­cu­la­tions.”

THE EX­PLAINER

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