Table of Contents

INDIAN CIVIL AVIATION INDUSTRY............3

Introduction..........................................3
Market Size...........................................3
Market Share of Domestic Scheduled Carriers
Major Challenges for Airlines in India. . .3
AIRLINE INDUSTRY...................................4
AIRLINE INDUSTRY KEY PROCESSES........4
SPICEJET - INTRODUCTION.......................5
BRIEF HISTORY OF SPICEJET....................5
SUBHEADING........................................5
SUBHEADNG.........................................5
SUBHEADING........................................5
CRISIS AT SPICEJET..................................5
SUBHEADING........................................5
SUBHEADING........................................5
SPICEJET FINANCIAL ANALYSIS.................5
SUBHEADING........................................5
SUBHEADING........................................5
COMPETITOR ANALYSIS............................5
INDIGO..................................................5
AIRINDIA...............................................5
POSSIBLE COURSE OF ACTION.................5
SUBHEADING........................................5
SUBHEADING........................................5
SUBHEADING........................................5
STRATEGY................................................5
FINANCIAL............................................5
OPERATIONAL.......................................5
MARKETING..........................................5

INDIAN CIVIL AVIATION

INDUSTRY

Sources: 1 Domestic Air Traffic Reports, Directorate General of civil Aviation (DGCA) Page
1 and 14
2
Report of Working Group on Civil Aviation for formulation of 12th Five Year Plan (201217), news articles, annual reports of airlines
Report of Working Group on Civil Aviation for formulation of 12th Five year Plan, Ministry of
Civil Aviation,GoI

Introduction

passenger aviation market with annual

passenger load of 450 million.

Over the previous two decades Indian

economy has grown at an average annual
growth rate of 5.8% (as per IMF data).
Recently with the revised formula for
calculating GDP, the country has
overtaken China as the fastest growing
major economy. Its present GDP growth
rate is estimated to be 7.4%. And with
such an increase in the GDP the travel
expenditure is also increasing and so do
the aviation industry.

Market Share of Domestic

Scheduled Carriers
Major domestic carriers are Indigo, Jet
airways, Air India, SpiceJet, GoAir, Air
Costa, Air Asia and Vistara.
36.4

19.6

The aviation industry in India has

expanded rapidly with the entry of low
cost carriers (LCC), foreign direct
investment (FDI) in domestic aircraft
carriers, modern airports, privatization of
airports, introduction of cutting edge IT
systems, increase in per capita income,
expanding middle income group and the
growing emphasis on regional
connectivity.

8.9

9.4

18.7

Source: DGCA - DOmestic Air traffic reports

Market Size
Currently the Indian aviation industry is
among the top ten in the world with
annual revenues of $16 billion. Total of
6.245 million passengers flew through
domestic airlines in January 2015
compared to 5.147 in the corresponding
period of previous year registering a
growth of 21.33%. And the total of 55.06
million passengers flew during Jan-Oct
2014 as against 50.7 million in the
previous year (According to the data
released by the Directorate General of
Civil Aviation (DGCA)1.
Also according to Airports Authority of
India (AAI) passenger and freight traffic is
expected to grow at rate of 5.3% and 5%
respectively for the next five years.
By 2020 the Indian aviation market is
expected to become the third largest
Sss

Major Challenges for Airlines in

India

Increasing competition
Increasing Debt burden
Rising fuel costs
Excessive Political intervention
Archaic laws
Exorbitant airport fees
Bloated workforce

transportation of passenger to the

aircraft.

There are three types of carriers

3. Airport Operations: Customer checkin, security checks, providing lounges and

other recreational facilities, cargo
handling (if the airline provides cargo
service)

1. Full Service Carrier (FSC): They

offer all the services such as passenger,
cargo and maintenance. They follow hub
and spoke model and are global players.

4. Passenger Operations: marketing

and sale of tickets, passenger boarding,
provide in-craft services like catering,
redress passenger grievances

Ex: Air India, Jet Airways

5. Flying Operations: Co-ordination

with Air traffic control, plan and schedule
flights so as to maximize air time. Training
of pilots and flight attendants, following
safety standards and procedures.

AIRLINE INDUSTRY

2. Low Cost Carrier (LCC): They offer

primarily the passenger air service, follow
a point to point network approach and
usually use secondary airports due to low
airport fee. They offer basic no frills
service
Ex: Indigo, SpiceJet
3. Charter Carrier (CC): they operate
flights for the customers on their demand
wherein the customer hires the complete
flight. Mostly operate for business houses
or for leisurely holiday destinations.
Ex: Taj Air

AIRLINE INDUSTRY KEY

PROCESSES
1. Aircraft Operations: The main
operations included under this are repair
and maintenance of aircrafts, checking of
aircraft before flight, overhauling of
engines and others critical components,
aircraft cleaning and other related
services.
2. Ground Handling: It involves loading
and unloading of luggage, ground
clearance, security check of luggage,
refueling/checking of aircraft,
Sss

SPICEJET - INTRODUCTION

SUBHEADING

SpiceJet is a rare success story from the

Indian Civil aviation sector, for few years
it performed well, provided on-time low
cost service to the people and gaining an
edge over the competitors through its
competitive fares. But lately it has been
into rough waters due a multitude of
factors. Here we discuss a brief history of
SpiceJet, the current crisis at SpiceJet,
possible reasons f2or it and find the
possible solutions for the airline and in
the end we also share our insight about
SpiceJet and Indian Civil Aviation Industry
from the whole story and put forward our
recommendations.

SUBHEADING

BRIEF HISTORY OF SPICEJET

COMPETITOR ANALYSIS
INDIGO
AIRINDIA

POSSIBLE COURSE OF
ACTION
SUBHEADING

SUBHEADING

SUBHEADING

SUBHEADNG

SUBHEADING

SUBHEADING

STRATEGY

CRISIS AT SPICEJET

FINANCIAL

SUBHEADING

OPERATIONAL

SUBHEADING

MARKETING

SPICEJET FINANCIAL
ANALYSIS

Sss