Though there has been a 34 per cent capacity increase in the Indian aviation market in the past six years, the rate of each seat utilisation has dipped 8.5 per cent.
Data from the ministry of civil aviation shows that overall seat factor has dipped from 63.8 per cent to 55.3 per cent in the same period.
This is because the number of passengers carried daily in the three domestic airlines has grown by only 11 per cent from 1998-99 to April 2003.
The daily revenue passenger kilometre has increased by only 15.8 per cent for the same period.
According to industry experts, this situation has primarily induced these airlines to introduce the highly discounted advanced purchase excursion (APEX) fare schemes and other such fare packages from last year. They added that the APEX fares had reduced yields and diluted market share.
Experts warned that this kind of situation, where the capacity increase was not in sync with the market growth, can be suicidal for the existing players.
