AirAsia-Tata JV to offer free seats

Discussion in 'Other Airlines | Asia/Australia' started by sobore, Mar 25, 2013.  |  Print Topic

  1. sobore
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    sobore Gold Member

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    Aiming to start operations by yearend, new carrier plans disruptive promotion scheme

    AirAsia, the region’s biggest budget carrier, is considering offering some seats for free when it starts flying in India, a company official with direct knowledge of the matter said.

    The operator plans to give away vacant seats for nothing at airports, expanding similar promotional offers at home in Malaysia, the person said, asking not to be named citing rules. Passengers will have to pay taxes and other fees, the person said. AirAsia, which is awaiting a licence after winning the Indian government’s approval this month to form a joint venture, is targeting to start operations by end-2013.

    Chief executive officer Tony Fernandes, who has said ticket prices will be the “No 1 differentiator” in India where 60 per cent of the market is controlled by discount airlines, is counting on the South Asian country for growth. His strategy may threaten a recovery at Jet Airways and SpiceJet, which are raising fares to cover costs after cash-strapped Kingfisher Airlines ended operations in October.

    “It will excite the market, but will hurt the airlines,” said Harsh Vardhan, chairman of New Delhi-based Starair Consulting that advises carriers. “AirAsia is entering a market where competition has matured. All of them have burnt their fingers, learnt their lessons and now they’ve stabilised themselves.”
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