IA marketshare dips

State-run Indian Airlines has lost about half of its market share to stiff competition from low-cost carriers and other private airlines.

Indian Airlines enjoyed a market share of 65.9 per cent about seven years ago "" it slid to 38.2 per cent in 2004-05.

Its passenger-capacity share fell from 65.2 per cent in 1997-98 to 41.7 in 2004-05. This was stated by the government in a presentation to a parliamentary consultative committee today.

There was a silver lining though. The committee was also told that various cost-control measures taken by Indian Airlines had resulted in savings of Rs 148 crore in the year 2004.

Indian Airlines also plans to join a global airline alliance in the long term. According to the airline, the benefits of this move will include greater inter-line flows, access to new markets through code-sharing, global image enhancement, and upgrade of technology and service standards.

Indian Airlines at present offers ground handling services to 19 airlines, including British Airways, Emirates, Lufthansa, Singapore Airlines, Malaysia Airlines, Silk Air and Sri Lankan Airlines at 14 airports in India.

Indian Airlines' ground handling revenues have grown from Rs 180 crore in 2003-04 to Rs 221 crore in 2004-05.

The committee was also informed of the fleet expansion and aircraft replacement plans of the airline. Indian Airlines plans to take aircraft on lease to meet its short-term requirements.

Currently on lease with Indian Airlines are 17 A320s, and 4 ATRs to service the Northeast market. In addition, it has plans to take on lease 10 more A320s for itself and 5 A319 aircraft for Alliance Air in winter 2005.

One of Indian Airlines' future plans is to have a dedicated freight operation by converting its 737 aircraft into freighters.