Singapore consultant sees India’s LCCs growing faster than FSCs
India represents the Asia Pacific region’s hope for a future growth engine in the aviation sector, especially a dynamic low-cost carrier (LCC) https://www.iata.org/segment.
“While the current gap in spending power means in India, the country’s GDP growth and the increased involvement of the private sector in aviation demonstrates the potential to become the engine that powers APAC’s growth story,” says Joshua Ng, a director at the Singapore-based Alton Aviation Consultancy https://altonaviation.com/.
A dynamic prevails in India where the unique demographics of the country have created an optimal environment for the development of new LCCs which are likely to deploy both the wide- and narrow-body aircraft to cope with demand on domestic routes.
“Tavellers will look for lower cost options and this will make the growth for LCCs much faster than the more premium full-service carriers (FSCs) in India,” said Ng.
But it is the share that the LCCs will have in the Indian market, according to Ng, pointing out that the type of aircraft flying domestic destinations will depend on route-demand and the connectivity between mega cities as well as the capacities at new airports being built across the country.
LCCs are well positioned to capture and stimulate new demand in the country, given the vast territory and large population as well as alternative to the railway network, Ng said on the sidelines of the Singapore Airshow https://www.singaporeairshow.com/ held 20-25 Feb 2024.
“Additionally, the Indian market is characterized by its high sensitivity to price, which tends to favour LCCs over the more premium FSCs,” he said after chairing a session at a forum on “Advanced Air Mobility” https://www.aapairlines.org/.
With strong macroeconomic tailwinds, the private sector has been getting increasingly involved in an industry that has been largely state-led. A first big step for private participation in airlines was the privatization of Air India in 2022 https://www.airindia.com/.
Commenting on airline asset growths, Ng said he is not expecting a new order from India’s existing airlines this year and next year, unless a new LCC operator gets into the market.
He noted that Indian airlines have placed orders last year for almost all of their aircraft requirements, given new planes are acquired on a cycle basis of five- or 10-year. fiinews.com
