From April to September this year, the number of flights between India and Abu Dhabi are set to grow by 75 weekly, which shows the new channel of Frequency for both areas.
As explained earlier Akasa is a new airline that has commenced operations and its second route is between Mumbai and Abu Dhabi. Besides, the company, Air India Express aims at introducing the services by flying from Mangalore to Abu Dhabi next week. However, IndiGo, the market leader has also followed the bandwagon and has planned to increase 14 weekly flights to Abu Dhabi and have direct flights daily from Mangalore and four weekly flights from Trichy and three weekly flights from Coimbatore. These services are planned to start on August 9, 11, and 10, respectively. On the same date, IndiGo will also commence operations on the Bengaluru-Abu Dhabi route.
The connectivity between India and Abu Dhabi would rise to 403 weekly frequencies on each side offering as many as 77,050 seats on both sides by the end of September. This expansion includes six airlines servicing 17 routes linking Abu Dhabi with Indian cities, major airports’ schedule data sourced from Cirium for this report.
Bilateral Agreements Fueling Growth
The connectivity has been improving as negotiators continue debating about rights to provide air services. India’s MOU and the UAE thus have a regional BASA with split arrangements with Dubai, Abu Dhabi, and Sharjah as individual emirates and not with the UAE as a nation. More seat entitlements were received in the subsequent years particularly after Etihad Airways which is the flag carrier of Abu Dhabi invested on Jet Airways in 2013 whereby entitlements went up from 13,300 per week to 50,000 per week in three years’ time. While Jet Airways closed its operations since then, the entitlement factor is still helpful for Etihad in the Indian market.
Market Dynamics
Presently, airlines from Abu Dhabi provide 61 percent of the frequencies and 62 percent of the seats between the two destinations of India and Abu Dhabi. Currently, the Indian carriers have 160 weekly frequencies. Etihad is the dominant airline on this specific route where it offers 43% of the frequencies and is supplying 45% of the seats. IndiGo follows the next place with the overall weekly offer of 21% that consists of 89 weekly frequencies and 21% of weekly seats containing 16,574; and the third place belongs to Air Arabia Abu Dhabi which provides 17 % weekly frequencies (72) and 16% weekly seats (12, 528).
Mumbai tops the list on the number of weekly flights offered to Abu Dhabi, oriented towards 63, followed by Kochi that is oriented towards 53 and Chennai orientated towards 37.
Why Abu Dhabi?
Several reasons could be attributed to the increment in flight frequency to Abu Dhabi which has been noted to have in the recent past been very busy. Over the years, the IndiA-Abu Dhabi market offered less number of seats as compared to other markets, even during the glorious days of a strategic partnership with Jet Airways. Due to the fact that the seat allocations have reached their maximum in case with airlines operating from Dubai as well as both Dubai and Abu Dhabi have turned into a couple of the most visited tourist destinations, Abu Dhabi starts to receive more attention.
Though, earlier there were criticisms of Indian carriers flying too less internationally, they are now touching the boundaries of multiple bilateral cooperation agreements like the ones with Vietnam and Indonesia. Hence, until these agreements are re-done, it becomes difficult to expand operations in other international sectors. This expansion might be a recent development in IndiGo’s strategic management as it seeks to refuse competition from other some existing carriers such as Air India Express and the newer entrant, Akasa Air that offer connections to Abu Dhabi.
International flights have the peculiarity of generating revenue in foreign currency which can be useful in case of currency volatilities because aircraft lease costs are normally in USD. However, tax on the consumption of fuels used for the international operations is charged dissimilarly and provides improved monetary profitability.
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Also, most of the Indian metropolitan airports are restricted in terms of availability of operating slots, and hence, they liberate slots exclusively for the international operations generating higher revenues. This in turn pressures airlines to focus on international flights.
Looking Ahead
While Emirates and Dubai are aggressively trying to increase seats between India and Dubai, presently the India-Abu Dhabi route is already on the verge of reaching the breakeven for UAE airlines while the Indians have not fully utilized their rights on this sector. Thus, as the flow of traffic between the two countries remains relatively constant, both Emirates as well as Etihad primarily assist connecting Indian passengers to international locations, passing by Dubai and Abu Dhabi correspondingly. Therefore, the local traffic is mostly maintained by the Indian carriers, which gives the reason for recent increases in flights.
Report By: Sonali Sarkar
Publish By: Your News Sources