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Low-cost Airline Business in India Sees Awesome Gimmicks
low-cost airline

The first low-cost airline in India – Air Deccan – paved the way for low-cost air travel in India in 2003 and brought air travel within the reach of the common middle class comprising well over half of the country’s 1.3 billion population.

Two of India’s LCC airlines – SpiceJet and IndiGo – keep offering their customers new ways of attractions. It is a different story, though, not even 5% of India’s population opt for flying as a travel option.

Spicejet, the low-cost airline, has come up with a new SME High Flyer Program. It is targeted at small and medium enterprises (SMEs). Spicejet claims that the program gives exciting benefits and Add-Ons to help SMEs fly to new heights. Its buzzword is – ‘The more you fly, the more you save’.

low cost airline

As per Spicejet, SME High Flyer Program comes with such features like:

  • Assured Discounts on Fares
  • Zero Change Fee
  • Complimentary Snack and Beverage
  • 50% Off on Cancellation Fee
  • Zero Convenience Fee
  • 50% Off on You1st
  • 20% Off on Spice Max and Preferred Seats

IndiGo’s latest offer has been – ‘Book using your Ka-ching credit card and get a flat ₹ 25,000 cashback as 6E Rewards on your stay at the Raffles Hotel, Udaipur.’

Salient features of IndiGo’s Offer

  • Offer Period: 9th August 2021 to 10th September 2021
  • Members must spend at least two nights stay at the Raffles Hotel, Udaipur
  • Booking must be through All Accor
  • Payment has to be done through a Co-branded Card.
  • Bonus Rewards under the Offer will be credited to the Membership Account after 60 days of the payment.
  • During the Offer Period, Members may earn up to 25,000 Bonus 6E Rewards as cashback on 1 night’s room charge in case of a minimum 2 night’s stay at Raffles paid for by the Members through a Co-branded Card.

For your info, the price for 2 nights, 2 adults at the Raffles Udaipur would be:
₹ 65000 (a 667 square feet room)
₹ 132000 (a 1291 square feet suite)

The Raffles Hotel, Udaipur is not a “Low-cost Hotel”. It is a priceless iconic property.

A few puzzling questions amaze the observer.

  • Will a normal air traveller who books an air ticket for ₹ 4000-5000, will ever think of staying in a ₹ 32,000 per night room?
  • Will a person who pays ₹ 66,000 per night for a hotel suite will like to fly in a cramped seat of a low-cost airline?

Also Read: IndiGo flight out of crisis: a revival story in Covid times

Low-cost Airline
The traveller goes for a ride

No wonder then, both Spicejet and IndiGo leave their shareholders in the lurch. While IndiGo reported a massive loss of 27,000 million in the June 2021 quarter, Spicejet is immersed deep in a pile of debt.

Spicejet has seen days when the Airports Authority of India had put it on a cash basis barely a year ago, forcing it to pay cash upfront every day for using airport services. It was due to unpaid debts to the tune of over ₹ 1.6 billion, although SpiceJet later stated that it had paid part of the debt.

Both SpiceJet and the Airports Authority of India are locked in a legal battle at the Delhi High Court.

The operational strategies adopted by budget/low-cost carriers in the aviation sector in India seem to be not coming up with the desired results. For the IndiGo think tank, this includes certain B2B ventures like linking with the businesses of some third parties like car rentals, saloons, medicines, or merchandise.

The low-cost carrier business model for existing players like IndiGo and Spicejet and for a new player like Akasa needs to be built around a number of verticals. All of them have missed out on several opportunities.

Also Read: SpiceJet: In Need of Another Turnaround

Also Read: Cashback Offers on Air Tickets the Most Effective way for Cheap Air Tickets

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By Geetanjali Wason

Blog author Geetanjali Wason writes info-packed articles. A Computer Science Graduate and an expert aviation writer. Since 2016 she has written several aviation and business-related articles at NC Airways.

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