Jet Airways – Kingfisher alliance, what’s in it for Online Travel Industry in India
Kingfisher – Jet Airways tie up to enhance revenue generation, down-size of man power follows
With India’s two biggest airlines tying-up to maximise revenue, down sizing has also been brought into action. Jet Airways has sacked 1900 employees which may include technical staff, ground staff, in-flight crew and people from other departments as well. The turmoil in the air travel industry is expected to worsen if not to get any better. All the airlines have been running in loss and now it’s time they start thinking of breaking even.
The cumulative market share of Jet Airways and Jet Lite (formerly Air Sahara) with Kingfisher and Kingfisher Red (Air Deccan) is pegged at 60%. The alliance is expected to bring collaboration in the areas of staff training, route interoperability, consumer loyalty programs and more.
What’s in it for the Indian Online Travel Industry?
- Better deals to offer to the consumer – Finally there is some relief after all airlines resorted to 0% commission for all travel agents (including OTA’s). With cost-cutting in play at airlines end the consumer for sure, is going to benefit and so is the Online Travel Industry since the majority of revenues in the Indian online travel industry still comes from flight bookings. Lower airfares are somewhat on the cards and with that air travel will take charge once again. The alliance might attract a couple of other airlines in as well – that would mean more cake for travel portals and their customers.
- More work for the techies – With route interoperability in effect, travel portals will need to adapt to the new routing plan. It’s an opportunity a travel portal or a travel search engine should be looking at from the usability perspective; after all the two airline groups handle 60% of the market share.
- Advertising Revenue – Good time to pitch in for advertising the new alliance on your travel portal if you run one. This however looks less probable because they’re cutting costs but who knows they might play the last over with open mind.
- Laid Off Employees – Yes, the travel portals may now have access to the talent pool Jet Airways had been holding.Though, I am not sure how many of the terminated employees could be readily employable in the online travel industry but you can still try by adding a “I am from Jet Airways” link on your home page and redirect it to your jobs/careers page. Need help with this? Have a look at WebChutney’s home page.
WebChutney Screenshot
Do you think there could be more to it? Feel free to express your thoughts in comments.
The curry is still being cooked.
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5 Responses to “Jet Airways – Kingfisher alliance, what’s in it for Online Travel Industry in India”
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“Finally there is some relief after all airlines resorted to 0% commission for all travel agents (including OTA’s).”
I wonder what will happen to all those travel agents? i dont think zero% commission will stay long, as agents are one of the powerful distribution channel for airlines…
moi just waiting and watching …..
Well, 0% commission structure has stayed in the US Travel Industry for a while and things seem to be going fine there (not after the economic retardation though). Travel Agents there have been earning bread by selling other products like vacations and hotels.
I think there would be some more shakeouts in the travel space… Maybe some in the online space over the next one-one and half years. They are also all in losses.
It would be interesting to watch.
I certainly agree with your views that a united airlines major will reap benefits, but there are 3 things i would like to put forward:
1) Is this alliance build to go the distance or just sticking to each other in the toughest times?
2) Do flyers set to gain any benefit the unless the fuel prices in India and surcharges go down?
3) Could this be the start of a monopolistic alliance?
Very well written article. Really liked the webchutney bit:). I hope you continue with this blog and update it regularly.
With regards to the industry, I personally feel that the real action has just begun. Wouldnt be surprised if we soon hear of some airlines stopping their operations, or some more mergers..
Cheers!