Wednesday, June 18, 2008

Airlines business is so stupid in India

The so called Low Cost Carriers LCC as they are called in short...

Looking thru the Chaos theory angle (a single moment is enough to cause flutter)

First of all they have to look at controlled market share


- rationalize the available seats based on usage.
- 10% of seats are used by foreigners, as I gather info - they dont mind hig cost
- 90% of seats have to filled based on the filling factor, book early get a discount - starting at 50%...

Cost per Mile - big factor to run a biz - so the cost should be adjusted based on the ATF price - inspite of sales tax cut by states.

Air Deccan had quoted Rs 88,000/- for 64 people charted in a Turbo Prop one way from Coimbatore to Bangalore - for a wedding party. I am not quoting the time, year - but it is withing recent times. So a one way cost for a 30 minutes flight is, Rs 1375. OK even assuming
a 50% price over the year, the cost shoudl not exceed Rs 2000 per head. I see that they are charing Rs 2500 or so, with about 80% load factor. So somewhere (Mumbai - Delhi?) route is getting subsidized by the off route feeds.

I have developed a fuzzy logic algorithm, during 2001 on pricing (including weather patterns and connections). For a few million dollars I can sell out a decent booking system. You can contact me.

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