{"id":52071,"date":"2023-11-25T18:56:19","date_gmt":"2023-11-25T13:26:19","guid":{"rendered":"https:\/\/aviationa2z.com\/?p=52071"},"modified":"2024-01-20T15:20:46","modified_gmt":"2024-01-20T09:50:46","slug":"indian-airlines-embrace-new-premium-strategies-to-attract-flyers","status":"publish","type":"post","link":"https:\/\/aviationa2z.com\/index.php\/2023\/11\/25\/indian-airlines-embrace-new-premium-strategies-to-attract-flyers\/","title":{"rendered":"Indian Airlines Embrace New Premium Strategies to Attract Flyers"},"content":{"rendered":"\n

DELHI-<\/strong> Premium Economy Trend Takes Flight in India Vistara (UK)<\/a> Paved the Way in 2015. Now, Nearly a Decade Later, Air India and IndiGo Join the Fray Vistara pioneered premium economy services in India with its launch in 2015. <\/p>\n\n\n\n

Fast forward almost a decade, and two major players in the Indian aviation scene, Air India and IndiGo, are gearing up to introduce their premium products as they compete for market dominance.<\/p>\n\n\n\n

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Photo: Courtesy to creator<\/figcaption><\/figure>\n\n\n\n

Fleet Upgrade<\/h2>\n\n\n\n

Air India had previously disclosed a $400 million plan to revamp its Boeing 777 <\/a>and 787 aircraft; recent information indicates that the existing fleet of 27 Airbus A320Neo planes will also undergo a retrofit, scheduled to commence in early 2024<\/p>\n\n\n\n

The update will encompass the addition of premium economy seating. Furthermore, Air India is leasing 25 Airbus<\/a> A320 aircraft, which will also be equipped with premium economy seats. Five of its Boeing 777 (formerly Delta aircraft) already feature premium economy seating.<\/p>\n\n\n\n

Introducing a premium economy product aligns with the goal of achieving product consistency with Vistara, which is undergoing a merger with Air India. In contrast, IndiGo (6E)<\/a> aims to move away from its no-frills image by considering incorporating premium seats and hot meals on its Airbus A321 aircraft. <\/p>\n\n\n\n

This strategic move is anticipated to benefit the airline as it expands its global presence and strengthens partnerships with international carriers.<\/p>\n\n\n\n

IndiGo CEO Pieter Elbers stated, “We are constantly reviewing our product portfolio and positioning. For now, our focus is to build a network, serve our customers, and ensure the company is in a favourable position.” IndiGo has yet to make a final decision on this matter.<\/p>\n\n\n\n

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Photo: avgeekwithlens\/ Harsh Tekriwal<\/figcaption><\/figure>\n\n\n\n

Surging Demand<\/h2>\n\n\n\n

“Air India and IndiGo’s Introduction of Premium Economy Reflects Rising Demand Post-Pandemic”<\/p>\n\n\n\n

The decision by Air India and IndiGo to incorporate premium economy cabins aligns with an increased demand for this product following the pandemic. <\/p>\n\n\n\n

Major international carriers serving India have also embraced this trend, with Emirates being the latest to introduce premium economy cabins on its Bengaluru and Mumbai flights.<\/p>\n\n\n\n

FCM India, a travel firm, has observed a 3% surge in economy class bookings and a 1.7% increase in premium economy class bookings, driven by the rise in domestic travel in 2023 compared to 2019. <\/p>\n\n\n\n

Despite international capacity not yet reaching 2019 levels, first-class and business-class bookings have experienced a nominal decrease of 1.3% and 3.8%, respectively.<\/p>\n\n\n\n

Indiver Rastogi, President and Group Head (Global Business Travel) at Thomas Cook India and SOTC, noted, “The Indian market is witnessing a strong and growing appetite for premium travel, and this is despite increased pricing<\/p>\n\n\n\n

“Vistara expressed its commitment to the three-class configuration, stating, “It has been one of our key strengths, and we have every intention of offering it on as many routes as possible.” However, specific data on cabin-wise loads was not shared.<\/p>\n\n\n\n

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Photo: Ian Abbott | Flickr<\/figcaption><\/figure>\n\n\n\n

AI Revenue Soars<\/h2>\n\n\n\n

The growth trajectory for Air India includes increased load factors and network-wide revenue attributed to expanded flight operations, improved pricing strategies, and enhanced revenue management. <\/p>\n\n\n\n

Notably, business class loads have risen from 40% to 60%. The airline has taken steps to enhance the passenger experience by introducing a new menu and addressing broken seats on its aircraft. Concurrently, revenue from ancillary sources is on the rise.<\/p>\n\n\n\n

Despite these positive developments, Air India faces challenges in targeting premium traffic on a significant scale, as its product is perceived as weaker compared to competitors. <\/p>\n\n\n\n

A consultant monitoring the airline notes that the success of business-class traffic relies on factors such as product quality, pricing, and flight frequencies. In specific routes like Delhi-Chennai or Delhi-Kolkata, IndiGo outperforms Air India by offering more frequent flights. <\/p>\n\n\n\n

However, there is optimism that this scenario will change as Air India undertakes product revamps and expands its fleet, although the airline has refrained from commenting on this matter.<\/p>\n\n\n\n

The editor of an aviation website, Ajay Awtaney, highlights the unique challenges of promoting premium economy domestically, citing Vistara’s experience of selling premium economy at lower prices than economy class to fill up the cabin. <\/p>\n\n\n\n

The hope is that lessons learned from such experiences will also be applied to Air India’s strategies.<\/p>\n\n\n\n

Stay tuned with us. Further, follow us on social media for the latest updates.<\/p>\n\n\n\n

Join us on Telegram Group <\/a>for the Latest Aviation Updates. Subsequently, follow us on Google News<\/a>.<\/p>\n\n\n\n

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CAPA: Indian Airlines to Order 380 New Aircraft by Next Year<\/a><\/blockquote>