India's booming airline industry will see further consolidation by 2010 amid growing competition, rising costs and over-capacity along key routes, an industry body said last week. At least fourteen new airlines such as Easy Air, Trans India and Star Air are seeking government approval to launch operations.
From just three private airlines in 2003, the number has jumped to ten, including low-cost carriers such as SpiceJet, Go Air, Paramount Airways and IndiGo.
"Carrier rationalisation along key routes is required, as we see over-concentration of seat capacity along main routes," said Kapil Kaul, chief executive with responsibility for the Indian subcontinent at the Centre for Asia Pacific Aviation (CAPA) on Wednesday.
"Greater consolidation is expected to continue... in the form of strategic alliances, market exits and buyouts of smaller airlines," he said on the last day of a three-day aviation summit in India's financial capital. India's low-cost carriers (LCCs) captured 35 percent of market share in April this year, Kaul said.
These budget carriers are likely to double their market share by 2010 - one of the highest in the world, the CAPA said in a recent report on the Indian subcontinent.