At a time when Air India is considering reducing the seats or doing away with the first class section in its long-haul flights, international carriers are wooing premium passengers from India.
Cathay Pacific will introduce first class service on its Mumbai-Hong Kong route later this month. Earlier this week, Lufthansa also announced upgrading its first class seats on the Frankfurt-Mumbai and Delhi routes. It said India was among the first countries in Asia where the new first class seats are being introduced.
"This is the first time we will introduce first class on our direct Mumbai-Hong Kong flight. We will operate a Boeing 747-400 plane, which has nine first class seats,'' said Cathay Pacific's sales and marketing manager (India) Rakesh Raicar. Till now, the airline operated an Airbus A330 plane, which has economy and business class configurations.
On the Mumbai-Hong Kong sector, Cathay Pacific's India office earns 23 per cent revenue from business class products. There has seen a growth of nine per cent this year, he said. Raicar did not share the total revenue as bookings are made world over.
"We see potential in introducing first class seats on the Mumbai-Hong Kong route and we are expecting 50-60 per cent loads,'' he said. On an average, first class fares are six-seven times higher than economy fares.
About 80 per cent of Cathay Pacific passengers to Hong Kong travel beyond China and the US. "Our flights to China, Japan, Korea and the US have first class seats. We were losing some premium passengers on the New York and Los Angeles sectors as they prefer travelling first class through the entire journey,'' he said.
The company's plans to launch first class seats pits it against Jet Airways, which too has a first class service on the Hong Kong route. Last moth, Jet introduced a Boeing 777 plane on this route offering first class seats and a bigger cargo capacity. "A Boeing 777 plane has capacity for 40 tonnes cargo. The plane has eight seats in its first class segment and has loads of 40-50 per cent in that category,'' an airline source said.
More From This Section
In an interaction with investor analysts following the first quarter results, Jet Airways vice-president (revenue management) Raj Sivakumar said, "For the international scenario, the front end (business/first class) has been lot more robust. As we have become established in more markets, we are starting to see more traction in the front end.''
According to HSBC Global Research's report on Asian carriers, the outlook for premium travel remains better than 2008-09 although there are some signs of weakness. It also noted that premium class fares are expected to rise in the second half of 2011 on a yearly basis, while there have been more special offers for economy travel.
"Overall so far, there is little evidence of a substantial yield decline,'' the report said.
Last week, the International Air Transport Association said premium passenger growth declined in Europe and North America in August due to economic slowdown. But "within the Far East, premium travel continues to show strong growth whereas economy travel within the region is more subdued.''
There was little sign of any slowdown of premium traffic in transpacific market, it said.