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It's typical term used in India first by Warwick Brady , the COO of Air Deccan over his concerns in pricing war on domestic airfares between various airline companies in India to grab the boom of Domestic aviation.
Infact the aviation market in India has grown about 50% in January-June. But the balance sheet of airlines reflect a different picture few key points to read up on
>>India has 13 private operators , combined total losses till date in 06, Rs.600 Crores
>>Deccan airlines cuts routes to sustain Losses
>>Indian Government says no More Airline licences
If you ask few simple questions
>>Why are airlines not charging enough for their tickets ?
>>Why are they operating their fleet in Losses?
>>Why there is a need to sell the airline tickets so cheap at time Rs1/- at times $19?
It boils down to "Pricing discipline" in terms of fares seems to be the need of the hour for the Indian aviation industry, which is running into huge losses.
Few facts which raise eye brows is excluding Indian Airline , every other major Indian airline is competing with each other at par with low cost carriers even though the operating cost is totally different from each other.
Although India is one of the most dynamic low cost airline markets in the world, Usually in any market, there is a single big player and few smaller carriers vying for different markets and segments. In India, all the carriers are battling on the same markets and contest for each others passengers with is point of concern.
India has just begun its long journey into civil aviation , without proper planning , healthy competitive pricing, most of the airlines would not look beyond more than a decade.
Even airlines have somewhat learnt to work together by sharing infrastructure and carrying each others passengers. But, the woes are still far from over.
