AI may set up hub in South India

Growing trade and commerce in the region could support passenger demand

Civil Aviation Minister Ajit Singh has asked Air India (AI) to develop a hub in South India to target passenger traffic from the region.

“Air India has to consider setting up a hub in Chennai or Bangalore. It can have its main hub in Delhi,” Singh said. He added the growing trade and commerce in the region could support the passenger demand.

The minister has called for a meeting on the issue next week.

The move is significant in the backdrop of AirAsia’s plans to make Chennai as its domestic base and its ambition to use South India as a base to fly to West Asia, Bangladesh, Africa and  parts of China.

Last June, Prime Minister Manmohan Singh had announced developing Delhi and Chennai as aviation hubs, but the proposal did not move forward.

At present, Air India operates 340 weekly international flights. It would be starting services to Birmingham and Sydney-Melbourne from Delhi in August.

Till a few years ago, Mumbai was the airline’s main hub but it shifted most of its operations to Indira Gandhi International Airport’s Terminal-3 in New Delhi in 2010.

The airline has no direct flight to Paris, Frankfurt, London and Hong Kong from any of the South Indian cities, whereas European airlines and Cathay Pacific have multiple flights to Chennai, Hyderabad and Bangalore. A study shows Dubai’s Emirates Airlines has 20-25 per cent of market share at Bangalore and Hyderabad airports and 13 per cent share at Chennai, which is much higher than its market share at Mumbai and Delhi.

SOUTHERN INTEREST

• AirAsia plans to make Chennai as its domestic base and to fly to West Asia, Bangladesh, Africa and parts of China
   
• European airlines and Cathay Pacific have multiple flights to Chennai, Hyderabad and Bangalore
   
• Air India has no direct flights to Paris, Frankfurt, London and Hong Kong from any of the southern cities

At present, Air India has its engineering base in Mumbai and Delhi. As a result, most of its medium to long-haul flights either originate or have a stop-over in Mumbai or Delhi. At other airports, its engineers only carry out pre-flight transit checks. “The airline’s engineering set-up in other cities will have to be upgraded to carry out maintenance work. The other option is to fly back the planes to Mumbai or Delhi, either as one-off commercial flights or ferry flights,” said a source. Also, it would have to set up operations and cabin crew base in these cities.

For now, however, the airline’s plan is centred around launching flights from Delhi and Mumbai. A senior executive at the airline said, “We are focussing on developing our hubs in Mumbai and Delhi. We already have point-to-point operations from South India to destinations in Southeast Asia. Developing a hub there would mean getting stop-over traffic from in-and-around Chennai. Majority of international passengers fly out of Delhi and Mumbai, where outbound business and holiday traffic is strong. So all the new international destinations we are adding, be it Birmingham, Sydney, Melbourne, Milan, Rome, Moscow, would be from or via Delhi.”

Overall, Mumbai and Delhi handle 200 international flights daily. Chennai has 100, while Bangalore and Hyderabad have 50 international flights each day.

According to the civil aviation ministry’s concept paper on developing hubs, only 10-12 per cent of traffic at Mumbai and Delhi could be categorised as transit traffic. In case of Dubai and Doha, it is 44 per cent and 61 per cent, respectively.