India’s outbound service providers are beginning to offer flight bookings through budget carriers.
They are aiming to bring in a lot of new customers to the country as well as improve the ease of booking flights.
India’s service providers, especially those in the domestic market, are taking the opportunity to introduce cheaper fares, which will boost revenue for airlines and boost profitability.
The new low fares will be the main factor in driving down ticket prices, especially for the domestic carriers.
Air India is planning to launch a direct flight from Singapore to Bengaluru and from Bengaluru to Chennai on January 1.
This flight will cost around Rs 50,000 and will run for a period of 10 to 12 hours.
The service providers say the flight is part of a plan to bring more people to the Indian market.
“We have set up a reservation portal for a direct direct flight for a group of four people.
The fare will be between Rs 50K and Rs 50L (about Rs 5,000 to $5,000), depending on the size of the group,” Air India spokesperson Prakash Chatterjee said.
The airline has booked 2,000 direct flights in the past two months.
It has also opened a direct route from Delhi to Mumbai, where it is also offering a direct service from Chennai to Bangalore on January 2.
The group booking includes two seats on the first class cabin.
With more flight options and more airlines taking advantage of this, the domestic flight booking is going to be very competitive in the coming months, said Prashant Kumar, partner at India-based consulting firm Deloitte Touche Tohmatsu.
There are some reservations that are going to get booked through budget airlines as well, said Kumar.
However, it is a slow process and the direct flights can only be booked through direct flights from Singapore.
Deloitte estimates that direct flights are the biggest driver of revenue for domestic airlines, with the flight booking from Singapore the second largest driver.
The flight booking process is often slow, he added.
The direct flights will bring more airlines to the domestic service providers.
The airlines have been offering direct flights for some time, and they expect this to continue, Chatterjee said.
Air India expects to attract a lot more people and businesses to the service providers in the near future, he said.
According to an internal survey conducted by Air India in February, around 50 per cent of the company’s current and former employees said they would consider travelling to India in the next three to four years.
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A few months back, the service operators launched an app called ‘Airline Traveller’ that allows the users to book flights on their smartphones and book a direct ticket from Singapore, Hong Kong or the United Arab Emirates.
This app was available only in India.
In India, domestic airlines have already been trying to attract more foreign passengers.
Several airlines have launched online flight booking portals that let customers book tickets from airports around the country.
The companies say this will help them in bringing in new customers and help them cut down their ticket costs.
These online portals are being launched as a part of the efforts to drive down ticket costs, but it will take a long time to make this happen.
The cost of booking direct flights is a major factor, said Chandrashekhar Singh, senior vice-president of the Air India division of Singapore-based investment bank Jefferies.
The cost of a flight in India is around Rs 60,000.
While the service is expected to bring a lot new customers, the costs of flying internationally will also increase in the long run, said Suresh Prasad, director at global research firm NPD Group.
The costs will rise as more foreign airlines will start to operate in India, Prasar said.