Air India Plans Hub for South India
Saturday, 20th July 2013 at 01:52am
Perhaps threatened by the entry of AirAsia into the local market, the state-owned Air India was told to build its own hub for its southern operations in the country.
Recently, AirAsia Bhd. announced that it will base its main hub in Chennai, a major commercial center in the south.
Ajit Singh, the Civil Aviation Minister of India, had earlier proposed to the flag carrier to put up a hub in the south of the country to strengthen its operations and support the growing demand in air travel from the region.
AirAsia, through its local subsidiary in India, has long planned to transform southern India into a major hub for its domestic operations as well as regional hub for its future regional expansion to Africa, Middle East and China.
Air India used to operate from two major hubs, namely: Delhi and Mumbai. Until a few years back, it scaled down its operations in Mumbai and moved some of its operations from there to Delhi. Mumbai, though, still hosts to more than 80% of the airline's domestic routes and about 60% of its international routes.
With its singular main hub in Delhi, Air India has moved farther away from the south to concentrate in the north which it considers as the more lucrative market.
The flag carrier has not established any direct flights out of the southern city to major markets such as Hong Kong, London, Frankfurt and Paris. This is a stark contrast compared to several European carriers who have multiple flights to Bangalore, Chennai and Hyderabad, three largest cities in southern India.
In the most recent study, it showed that the Dubai-based Emirates even captured a far bigger market share in two southern cities of Bangalore and Hyderabad than its share in Delhi and Mumbai.
The flag carrier, though, has no immediate plans of developing a southern hub under the present circumstances. The airline source said that Air India is still focusing on its operations in Delhi for its expansion. The airline is still looking forward to launch more flights out of Delhi, either as a main destination or as a transit point.
The airline source further said that a hub in southern India is not yet feasible for the airline as most of the outbound business and holiday travelers come from or around northern India, particularly Mumbai and Delhi.
Besides, it added, the airline already operates point-to-point services to Southeast Asia from southern Indian cities.
Air India made it clear that any service expansions in the immediate future will have to be coming from Delhi.
By: Pete Lee.