Since the time the Tata group acquired Air India, the focus has largely been on Air India and not Air India Express, the low cost subsidiary. While Air India Express may be small, it has been profitable and the Tata group decided to continue Air India Express in “Business As Usual” mode even as went around buying the remainder of the stake in AirAsia India, making it a subsidiary of Air India and working towards the merger of AirAsia India with Air India Express.
AirAsia India started with much fanfare in 2014. A break even within the first year and promise to take on IndiGo were just some of the announcements which veered off in thin air. Instead the entity found itself in one controversy over another which also reached the door of the Tata’s.
The mega order done, the focus shifted to the brand unveiling of the new Air India and to discussions around the merger of Vistara with Air India. All along Air India Express chugged along, integrating AirAsia India with itself, starting with permission to sell AirAsia India flights on a single platform, transferring the planes from AirAsia India to Air India Express one at a time and preparing for a new type, the 737 MAX 8 induction – two of which have already landed in India and undergoing painting before the big brand reveal.
Amidst this, the website shifted to the new branding late last week. The new combined website was a hybrid mix of Air India Express branding on AirAsia India’s website until then. The new website is vibrant orange with possible signs of times to come in terms of colour scheme which has been selected for the low cost subsidiary. Read
IndiGo has been consistent with its product. Until now, the airline has stayed away from ovens onboard for the extra weight they add (and also cost). This has meant that be it corporate traveller or individual, short haul or longer flight – the passengers have had to make do with cold food or instant food.
AirAsia India has always had hot food, in fact the airline has also been serving pre-booked meals on priority – a differentiator. If the rebranded airline can communicate about food and have pricing which remains closer to or cheaper than IndiGo, Air India Express has a winner at hands here with IndiGo not having any chance of matching the offering since it lacks ovens in its planes.
As IndiGo plans longer flights with its narrowbody aircraft, one of the pertinent questions that gets asked is about the charging points or streaming. How does one sit for so long without any entertainment? If the passengers get enough on their phone, there are no charging points.
The revamped website of Air India Express shows streaming services named Airflix which mentions discounts on purchases, inflight menu, streaming and games amongst others. Will it be covered over the entire fleet? Will it be a value differentiator?
The Tata group came up with a loyalty app for the entire group. Named Tata Neu, the low cost carrier was one of the early entrants. Air India (and Vistara) have their own loyalty programs and with codeshare flights, passengers would get to earn points.
Traditionally, India has been loyal to low fares barring a small percentage of passengers. Yet, loyalty cards have been flaunted by everyone. A simple to understand program could do wonders to attract passengers – especially since the current program is across the Tata group of companies.
The differentiator may well be in place but what would be needed is scale which currently remains unmatched for IndiGo. The best of service, the best of entertainment and the best of food starts attracting passengers only when there are plethora of options – in routes on offer as well as multiple frequencies on a route.
IndiGo’s upcoming loyalty program is an open secret, which will counter Air India Express to an extent. On the other hand, the combined reach of Air India and Air India Express on international routes far outweighs that of IndiGo. Even with the multiple codeshare and interline agreements that IndiGo is getting into, the benefit of transfers in a single terminal at Mumbai and Delhi gets a leg up for the Air India group.
The investments by the Air India group in ovens, loyalty and streaming need to see returns – where passengers pay incremental revenue for what is on offer, else taking on IndiGo will take a back seat and the focus will shift on recovering the investments. The battle with Air India group finally will see IndiGo get a formidable competitor in Indian skies and the result would hopefully be in favour of the passenger.
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