Aviation

Hand Out (For EGBT classes)

(A) Introduction :
This analysis is restricted to a brief overview of Aviation, its history, global aviation
industry and civil aviation in India and present status & developments.
(B) Overview :
The presentation addresses to the typical duopolistic characteristics of Aviation Industry
in the world, types of Airlines (FSC & LCC), Global LCCs, factors of profitability.
(C) Aviation Sector in India :
The Service sector in India constitutes about 57% of Indias GDP. The aviation industry
has played a vital role in facilitating growth (currently 6% of GDP) with significant
multiplier effects.
Aviation sector in India is growing at the fastest rate (16% CAGR on volume of air-traffic
basis). Analysts forecast that the Indian Aviation Sector would be 3rd largest in the world
by 2020 and may be the LARGEST by 2030.
(D) Present Status:
Popularity & Success of Low Cost Carriers (LCC) against Full Service Carrier (FSC)
Market share of various Airlines IndiGo (30%), Jet Airways (22%), Spice Jet (20%), Air
India (19%) and Go Air(9%).
(E) Major Airlines in India & their performances
Covers briefly Air India, Indigo, Vistara, Jet-Etihad, Air-Asia India
(F) Recent Developments:
1. Google Inc. has launched flight searches in India. : google.co.in/flights
2.Air Costa plans to add 8 aircrafts by 2016 to its fleet of 4 aircrafts.
3. Boeing is to set up an aircraft manufacturing base in India ('Make in India)
4. Vistara has signed inter-line agreements with Singapore Airlines and SilkAir.
5. Air Works India Engineering has formed a JV with Yaksa Investment to provide
aviation maintenance services to international airlines and domestic operators.

For Class discussion at NDIM

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6.US Federal Aviation Administration (FAA) has approved a product developed and
produced by the firm in India UTC Aerospace Systems, Bengaluru to indigenously
produce and directly ship an aviation product to aircraft manufacturers in the US.

(G)Government initiatives :(a) FDI (49%) in Aviation sector,

(b) NRI 100% FDI for domestic air services
(b) Import of ATF allowed, leading to easing cost pressures
(c) Re-vamping of National Carrier : Air India
(d) Investment for setting up new airports
(e) Encouraging PPP model for mega projects & operation
(H) Key Takeaways:

Aviation : Meaning & History

Understanding the dynamics of the aviation sector
Assessing the factors determining profitability
Types of Airlines ( FSC & LCC)
Global LCCs
Airlines in India & their performances
Recent Investments & Developments In Aviation Sector of India
Initiatives by GOI

(I) Class questions :

1. What are the challenges & prospects of the Indian Aviation Industry?
2. Do you think the future lies only with Low Cost Carriers?

For Class discussion at NDIM

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