Jet Airways 2008 Kingfisher Acquired 49% Stake in Deccan Aviation Regregulaulattooryry Aauutthhoorriitiesties
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JEJETT AAIRIRWWAAYSYS AirAirlinlinee IIndndustustryry iinn InIndiadia 454 airports and airstrips (includes Operational, Non Operational, Abandoned and Disused Airports) 127 are owned & operated by AAI 16 - international, 7 custom airports, 28 civil enclaves Scheduled domestic air services - available from 82 airports May 2007- May 2008 25.5 million domestic & 22.4 million international passengers 20% growth – highest in the world Growth Rate Projections (for next 5 yrs) 15% p.a (Passenger Traffic) 11.4% p.a (Cargo Traffic) HisHistorytory 1911 First commercial flight Airmails from Allahabad to Naini(10 km) 1932 The Aviation Department of Tata Sons Ltd. Established 1938 Tata Airlines (successor to aviation division of Tata Sons) 1946 Tata Air Lines converted into a public Company and renamed Air India Limited Air India International incorporated 1948 Nationalization of Aircraft Industry 1953 Air India (serving the international sectors) Indian Airlines (serving domestic sectors) Deccan Airways, Airways India, Bharat Airways, Himalayan Aviation, Kalinga Airlines, Indian National Airways and Air Services of India HisHistorytory 1986 Private Sector Players permitted as Air taxi operators Players including Jet, Air Sahara, NEPC, East West, Modiluft,etcstarted service 1990 Open Sky Policy 1994 Private Carriers permitted to operate scheduled services 2003 Entry of low-cost carriers 2007 Merger of Indian Airlines into Air India Acquisition of Air Sahara by Jet Airways 2008 Kingfisher acquired 49% stake in Deccan Aviation RegRegulaulattooryry AAuutthhoorriitiesties Ministry of Civil Aviation Responsible for the formulation of policy, development and regulation of Civil Aviation. Its functions also extend to overseeing airport facilities, air traffic services and carriage of passengers and goods by air Other Attached/Autonomous Organizations: Directorate General of Civil Aviation (DGCA) Promote safe and efficient Air Transportation through regulation and proactive safety oversight system Bureau of Civil Aviation Security (BCAS) Regulatory authority for civil aviation security in India Airport Authority of India (AAI) Accelerate the integrated development, expansion and modernization of the operational, terminal and cargo facilities at the airports PPolicoliciesies Open Sky Policy FDI Airports 100% for green field operations 74% for existing airports - 100% with special permissions 100% tax exemptions for 10 yrs. Airlines 49% in domestic airlines - 100% for NRI’s 74% in cargo & non-scheduled airlines MMaarkrketet SShhaarree inin DomDomeesstictic MMaarkrketet In Post Consolidation Jet includes Air Sahara & Kingfisher includes Air Deccan §Market Share is based on their Capacity Source: B&K Securities ServServicicee vvs.s. PricPricee High Jet Airways Kingfisher Indian Airlines Full Service Air Deccan SpiceJet Go Air Indigo Low Low High Price Source : http://www.foolonahill.com/mbaaviation.html CCoostst StrStrucucturturee Source : http://www.foolonahill.com/mbaaviation.html JJeett AAirwirwaaysys Founded in 1993, Chairman - Mr.Naresh Goyal HQ in Mumbai Country’s second largest international airline Largest domestic airline - 31% Primary base - Mumbai's Chaatrapathi ShivajiAirport Secondary hubs - Bangalore, Brussels, Chennai, Delhi, Hyderabad, Kolkata and Pune. April,2007 - Acquired Air Sahara - JetLite Now JetLite integrated into Jet Airways InInternternationationalal NetwoNetworkrk DDomesomestictic NNeetworktwork FleetFleet PlaPlann JetJet AirwAirwaaysys -- PerformPerformanancece Annual Revenues - Rs.9481.5 crores (2007-08) Rs.7401 crores (2006-07) Profit(Loss) After Tax - Rs.253 crores loss (2007-08) Rs.27 crores profit (2006-07) - All Other Domestic Players showed loss(2006-07) OpOperationerationalal HigHighlihlighghtsts ReRevveennuueses && ExExpenpenditurediture SSpliplitt-- upup JetJet AAirwirwaayyss vsvs.. DDomeomeststicic PlaPlayeyersrs (2(2000606)) JetJet AAirirwawayyss vvs.s. InIntternaernattionionaall PlaPlayeyersrs ((2020006)6) STPSTP Primary Segments (Geographic) - Domestic & International Customer Segments First class, Premiere(Business) class & Economy class Target Segments Premiere(Business) class Business travelers, contribute 48% of passengers & 66% of revenues, ready to pay higher prices, last time booking, don’t like transit Economy class Leisure travelers, prefer low cost airlines, ready for transit if there is cost advantage, large % of passengers Seat Allocation – Yield Management Technique Positioning – High value for High price Unique Selling Price – Customer relationship and Punctuality SeSeaatintingg inin flflighightsts forfor SeSeggmenmentsts FFleetleet SizeSize FloFlowerwer ofof ServicServiceses Information - Reg. the org., flight schedules, ticket fares, promotion schemes etc. Through website, call service, sms, employees etc. Consultation - Reg. the choices of class, routes to a destination & special menus for frequent fliers Order taking - Booking - through phones, fax and internet - Ticket Office, Call Centres, Company Website & Agents Hospitality - Most important differentiating factor (from ticket booking t o post flight help) Safe keeping - Luggage & Children Exceptions - Special requests reg. meal preferences, special amenities for elderly people or children, medical needs etc. Billing - Charges split, E-mail bills etc. Payment - Credit card, Travellers cheque, Special payment privileges for frequent fliers ImImppactact ooff ITIT oonn TicTickketet BookingBooking LLevelsevels ooff PrProduoducctt PrProduoducctt -- SeSerrvicvicee On Ground Services Check in options - Airport check-in, Tele Check-in, Web Check-in, Kiosk Check-in, SMS Check-in, Check-in while walk-in, One Time Check-in on Return Journey, Through Check-in Airport Lounges Coach Services In-flight Services Classes of Service - First class, Premiere class & Economy class Convenience & Safety -Towels, Pillows & Blankets, Reading material, First Aid, Smoke detectors, Bassinets, Child Care, life jackets & seat cushion Cuisines Entertainment - Jetscreen– Movies, TV programmes, Games, Music, In-flight communicator, Online magazines etc. JetWings (in-flight magazine), JetBoutique (in-flight shopping catalogue) PrProduoducctt -- SeSerrvicvicee Special Services o Infant and child care, wheel chair assistance, expectant mothers, unaccompanied minors, medical emergencies, travelling with animals & carriage of stretchers JetMobile JetKids JetEscapes Cargo JetJetPrPrivilivilegeege –– FFrrequentequent FlyerFlyer PrProogrgramam Membership tiers – Blue, Blue Plus, Silver, Gold & Platinum Personalized web access JP Miles - 13 quarters validity Bonus JPMiles on e-Services Additional baggage allowance Guaranteed reservations up to 24 hrs. prior to departure Waiver on cancellation fees Membership Tier Bonus Earning & Redeeming JP Miles Eg: Chennai to Thiruvananthapuram (Earn Mile-383 & Redeem Mile-6894) Airline Partners - Air France, American Airlines, ANA, Austrian Airlines, Brussels Airlines, Cathay Pacific, Dragonair, Etihad Airways, Gulf Air, JetLite, KLM, Lufthansa, Northwest Airlines , Qantas, South African Airways, SWISS, United Airlines and Virgin Atlantic. PricPricee Economy & Club Premiere Fare Discounted fare for senior citizens & defense personnel Advance Passenger Excursion/ APEX Fares One Fare Night Saver Fares Check Fares US Dollar Fares & Visit India Fares PPlacelace Place of Service - Aircraft Various Destinations PromPromototionion Offers Companion Free Offer, One Fare, Concessional fares, JetPrivilege Offers, Jet Airways Citibank Credit Cards, Corporate Deal Offers, International Specials, Camp Rock contest, Festival specials, Student specials, Surprises etc. Advertising and Branding Hoardings Brand Ambassadors Sponsorships Event Organization PeopPeoplele Employees Pilot, Cabin Attendants, Engineers, Customer Service Agents, Securities, Marketing, Sales & Reservation employees Customers PPartnartneerrss Airline Partners - Air France, American Airlines, ANA, Austrian Airlines, Brussels Airlines, Cathay Pacific, Dragonair, Etihad Airways, Gulf Air, JetLite, KLM, Lufthansa, Northwest Airlines , Qantas, South African Airways, SWISS, United Airlines and Virgin Atlantic. Code Share Partners - Air Canada, All Nippon Airways, American Airways, Brussels Airlines, Etihad Airways and Qantas Co-Brand Cards - CitiBank Conversion Partners - BarclayCard, CitiBank, Deutsche Bank AG, HDFC Bank, HSBC, ICICI Bank, SBI Card & Tata Cards Car Rental Partners - Avis, Hertz Hotel Partners - Global Hotel Alliance, Hilton Family Hotels, Hyatt Hotels & Resorts, InterContinental Hotel Groups, ITC etc. Lifestyle Partners - Globus and Golf Fee Card International Publishing Partners - Fortune, The Economist and TIME Retail Partners - Ferns n Petals Telecommunication - Matrix Cellular Services CCoompmpeetititorstors International market - British Airways & South West Airlines Domestic market - King fisher, Indian Airlines, GoAir, Spicejet & Indigo ProcProcessess People Processing People physically enter the service system to receive the service. Aircraft is the service factory where service is delivered. Possession Processing Cargo Luggage & Courier PPhyhysicsicalal EvEvididencencee Servicescape Servicescape usage - Interpersonal Complexity of Servicescape - Elaborate Flight Offices - Org. & Ticket Booking Agents Virtual Servicescape ServServicicee QQualualityity Source : http://www.foolonahill.com/mbaaviation.html ServServicicee QQualualityity Source : http://www.foolonahill.com/mbaaviation.html SSttratrateeggiesies