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Domestic Airlines in India :   Leveraging Price                           1
Airlines HistoryAir India• Started by JRD Tata on 15th Oct 1932Jet Airways• Incorporated on 1st April 1992 as Private  C...
About The Case Study PRICING WARS• IA announced 3-15% cut in fares in June 2002.• Next day JA reduced prices by Rs 635 fo...
About The Case Study SAHARAS Various Schemes•    Wings & Wheels scheme in March 2002.•   ‘Sixer’ Offer scheme during July...
Monopoly• Up to 1990 Indian Airlines.• IA and AI retained monopoly over Civil Aviation.• Single service provider and many ...
Oligopoly• The period after 1990, Monopoly ended• An industry dominated by a small number of large  firms• Firms provide e...
Factors Affecting Cost•   Labor•   Fuel Price•   Capital•   Ownership & Control•   Airline Acquisition/Leasing Cost•   Ope...
Conclusion• Remarkable growth in recent years in      Indian aviation industry• Bright future of Aviation industry in Indi...
Thank You !              9
Thank You !              9
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Domestic airlines in india leveraging price

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Domestic airlines in india leveraging price

  1. 1. Domestic Airlines in India : Leveraging Price 1
  2. 2. Airlines HistoryAir India• Started by JRD Tata on 15th Oct 1932Jet Airways• Incorporated on 1st April 1992 as Private CompanySahara Airlines• Began operations on 3rd Dec 1993 with 1 aircraft 2
  3. 3. About The Case Study PRICING WARS• IA announced 3-15% cut in fares in June 2002.• Next day JA reduced prices by Rs 635 for economy class• APEX fares scheme• Sahara’s Strategy INDIAN AIRLINES Schemes• ‘Wings Of Freedom’• ‘Bharat Darshan’ 3
  4. 4. About The Case Study SAHARAS Various Schemes• Wings & Wheels scheme in March 2002.• ‘Sixer’ Offer scheme during July –August.• ‘Steal a Seat’ online bid scheme in August 2002.• Steal Buys scheme 4
  5. 5. Monopoly• Up to 1990 Indian Airlines.• IA and AI retained monopoly over Civil Aviation.• Single service provider and many users of service.• Service provider had low elasticity with no close substitute.• The firm faces the market demand curve for its product. 5
  6. 6. Oligopoly• The period after 1990, Monopoly ended• An industry dominated by a small number of large firms• Firms provide either identical or differentiated services• The industry has significant barriers to entry with respect to capital and regulations 6
  7. 7. Factors Affecting Cost• Labor• Fuel Price• Capital• Ownership & Control• Airline Acquisition/Leasing Cost• Operating Costs 7
  8. 8. Conclusion• Remarkable growth in recent years in Indian aviation industry• Bright future of Aviation industry in India• Infrastructure Constraint• Liberalise rules & regulations governing civil aviation• Reduction in prices and lease rentals. 8
  9. 9. Thank You ! 9
  10. 10. Thank You ! 9

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