The Aviation industry in India is one of the fastest growing sectors globally. The sector has
undergone rapid transformation since the liberalization drive that began in the earlier half of the
decade. The origin of Indian civil aviation industry can be traced back to 1912, when the first air
flight between Karachi and Delhi was started by the Indian State Air Services in collaboration
with the UK based Imperial Airways. It was an extension of London-Karachi flight of the
Imperial Airways. In 1932, JRD Tata founded Tata Airline, the first Indian airline. At the time of
independence, nine air transport companies were carrying both air cargo and passengers.
In early 1948, Government of India established a joint sector company, Air India International
Ltd in collaboration with Air India (earlier Tata Airline) with a capital of Rs 2 crore and a fleet
of three Lockheed constellation aircraft. The inaugural flight of Air India International Ltd took
off on June 8, 1948 on the Mumbai-London air route. The Government nationalized nine airline
companies vide the Air Corporations Act, 1953.. By 1995, several private airlines had ventured
into the aviation business and accounted for more than 10 percent of the domestic air traffic.
Today, Indian aviation industry is dominated by private airlines and these include low cost
carriers, who have made air travel affordable.
1.2 Porter’s Five Forces
SUPPLIER POWER – High
ATF Fuel Prices.
Food Inflation Might Affect The
Industry As Food Provided By
Kingfisher Is Packed Through
BUYER POWER – Low
Economic and Demographic
Higher Disposable Incomes.
Increasing no. of Working Women.
Exposure to Global Brands.
(Moderate to High)
Competitive Pricing is there
Many upcoming players
High exit costs involved
THREAT OF SUBSTITUTES
Moderate to High
Indian Railway has improved
service level and quality. Can
give good competition in future.
Other Modes of Transportation.
ENTRY BARRIERS - High
Very Huge Capital Investment
Till 1991 No Private Player Was
Allowed Due To License Raj
Subject To Strict Regulations
Still Govt. Interference In Pricing
1.3 Pestel Analysis
Open Sky Policy
India?s Political environment-Tension with Pakistan, Government?s inability to
control issues(Riots etc.)
September 11-huge drop in air traffic due to safety and security concerns
Trade relations with other countries have to be good
High operations cost due to huge demand which resulted in laying off employees at
the time of recession.
There has been huge contribution to the Indian Economy
Rising cost of fuel
There has been huge investment in the aviation sector
People from varied groups have to be catered
Destination, kinds of foods served have to be chosen carefully
Development of cities leads to better services and airports
The status symbol attached to a plane travel
Use of internet-online ticket booking,updated flight information and handling of
Restrucutring the existing airports to world class appeal.
The growth of e-commerce and e-ticketing
Satellite base navigation system
Modernisation and privatization of the airports
Developing green field airports with private sector. For example-In Bangalore,
“Airport Corporation Limited”.
The increase in global warming
The sudden and unexpected behavior of the atmosphere and the dependency on
Shortage of the infrastructural capacity
Airlines Acquisitions and the leasing cost.
1.4 Market Share
(Directorate General of Civil Aviation)
KINGFISHER AIRLINES was introduced by Mr.Vijay Malliya on 7th may 2005 , it was a
subsidiary of united breweries holding limited. It was introduced in year 200