Legacy airlines reverse trend - gain lost ground in February

The new kids on the airline block have been dealt a temporary setback in February as legacy carriers regained some of their lost market shares, in a month which has been traditionally been a lean period for air travel.

While Indian (formerly Indian Airlines), Jet Airways and its low-cost version Jetlite (formerly Air Sahara) saw their shares of the Indian aviation pie increasing, new entrants with the notable exception of Deccan and SpiceJet, registered smaller shares as compared to January.

This is in marked contrast to the aggressive growth exhibited by the new airlines who had taken over a large portion of the market share earlier occupied by the legacy carriers. Analysts attribute the trend to the ongoing consolidation in the market coupled with corrections in fares.

State-owned Indian's share in the Indian aviation market grew by 50 basis points (bps) at 14.40% from 13.90% in January. However, this was still down 160 bps from 16% in February last year. The two airlines from Naresh Goyal's stable – Jet Airways and Jetlite, registered gains of 50 bps and 57 bps respectively over their January figures, and were at 23.2 per cent and 7.4 per cent market shares. This was still less than last year's corresponding figures of 25 per cent and 8 per cent respectively.

As for the challengers, IndiGo was down 93 bps at 9.90 per cent, GoAir was down 50 bps at 4.40 per cent and Paramount down 5 bps at 1.20 per cent, respectively. These figures are with reference to their January numbers. Kingfisher Air, which had seen  its market share jump 450 bps year-on-year in January, had a disappointing February with its share skidding to 14.2 per cent from 15.36 per cent in January. However, this was still 420 bps higher when compared to last year.

In contrast to the other new entrants, Deccan and SpiceJet recovered quite a bit of  lost ground by gaining 19 bps to 14.59 per cent and growing by 11 bps to 10.6 per cent respectively.