AIR DECCAN

GROUP 3, ARUN S KRISHNA PRASHOBH SIBIN JAMES VINOD K S

Air Deccan
Air Deccan was the largest private low cost carrier in India. Air Deccan launch in 2003, had grown serving from 2 destination to 65 destination in 2007. The vision of Air Deccan is empowering every Indian to fly New airlines were increasingly differentiating there services and took a cautious approach to market expansion.

Indian aviation market

Indian aviation sector deregulated in 1994. The demand for air travel India is mainly driven by leisure/visiting, friends and relatives. The airport infrastructure in the country was not able to keep up with the growth in air traffic. Increase in air traffic also led to a corresponding increase in the demand of pilots. There was a lack of maintenance and repair facilities in inida.

Cont.
The main problem in the sector is high tax rate on aviation turbine fuel. Aviation accounted for 40% of total operating cost. DAL was launched in 1997 by captain gopinath. By 2007 air Deccan held close to the 20% domestic aviation market.

Creation Air Deccan

Initiative of Deccan aviation ltd (DAL) Passengers in and around the world buzz model Domestic aviation market Low cost air travel

Targeted market
Classification of the passengers Growth of business sectors Concept of no frills Marketing technique Advertising, news paper

Pricing system
Basis on the time booking Tickets were priced 40% lower No 3rd party operations were carried Development of ccrs Route selection

HUMAN RESOURCES
The human resource of Air Deccan very harsh to the employees. It provided limited perks to its employees. Air Deccan pilots stayed in company maintained guest houses and transit houses. Meritorious employees were promoted to supervisory positions and positions in management or as trainers. The work force was non-unionized.

COMPETITORS(FSC Segment)
Indian. Jet Airways. Air Sahara. Kingfisher airlines.

COMPETITORS(low cost players)

Spice jet. Indigo airlines. Go air.

Air Deccan in 2007

It was not able to get attractive landing slots at busy metro airports as compared to the newer airlines. Also the media was not favorable to the airline. Passengers problem with last minute cancellations. The company had to invest heavily in engineering, tooling and equipment. Due to its policy of outsourcing ground handling, the airline appointed many-handling agents who did not have any previous experience.

 In Feb, 2007, the chief Financial Officer (CFO) who was with Air Deccan since 1997 resigned. However by early 2007 differences between Gopinath and Brady over route rationalization led to Brady's departure. Some of the decisions taken by Brady were overturned and some were taken without the Knowledge of the top management.

Infrastructure bottlenecks
Difficulty in infrastructure comparing to other airlines Examples like; 3 years to get a land in Chennai Purchase of Porta-cabin Parking space Bird hits on air crafts

Initial public offer

Raise Rs3730 million through thee book building method, at Rs 146 per share Extended issuing date to 3 days and oversubscribed by 1.23 times.

pricing
Lowest possible levels for Indian passengers 30% of the passengers were first time travelers and losing 500 to 1100 seats.

future
Acquisition by King Fisher Increase the fare

conclusion
Decisions by Vijay mallya, Merge Air deccan with King Fisher Make air deccan subsidiary Maintain status quo and harvest

THANK YOU