News

Boom in domestic aviation will continue for at least a year more

CEOs see passenger traffic growing 20-30%
Hindu Business Line; 26 October 2007

New Delhi, Oct 25: The boom in the domestic airline industry will continue for at least another one year with passenger traffic likely to grow at 20-30 per cent.

This is the opinion of more than 60 per cent of the chief executive officers who participated in a snap poll conducted by the Federation of Indian Airlines (FIA).

A small minority felt that the growth in passenger traffic could be higher at 30-40 per cent during the next 12 months.

While declining to divulge which airlines were more optimistic on passenger growth prospects, sources said that the meeting where the poll was carried out was attended by officials of the eight domestic airlines including the Chairman and Managing Director, Air India, Mr V. Thulasidas, the promoter of Kingfisher Airlines, Mr Vijay Mallya, as also the Chief Operating Officer of the low-cost airline, IndiGo, Mr. Steve Harfst.

The growth of the industry could be faster if steps were taken to bring down the cost of aviation turbine fuel as also develop airport infrastructure, the CEOs felt. A majority of those present were of the opinion that three-to-five years was a realistic time frame for improvement in airport infrastructure in the metro cities, while it would take one-to-three years for the similar development at airports in non-metro cities.

There was also a feeling that the current Government policy of not allowing two airports in a city needed to be reviewed. "With the current market growth trends in passenger traffic there is a perfect case for allowing airports in Bangalore and Hyderabad to co-exist," an airline official said.

The Executive Director, Jet Airways, Mr Saroj Dutta; the Managing Director, GoAir, Mr Jeh Wadia; the Chief Executive Officer, SpiceJet, Mr Siddhanta Sharma; and the Chief Executive Officer, Air Deccan, Mr Ramki Sundaram, were among those who attended the meeting. The Managing Director, Paramount Airways, Mr M. Thiagarajan did not attend the meeting but responded to questions, sources said.