May 31, 2014: Air Asia which is all set to undertake its maiden flight in India shocked the airline industry by making 15,000 tickets available at a base fare of Rs. 5. This fare excludes airport taxes and other fees and after including these, fare would be around Rs.990. This promotional offer is available on Bangalore to Chennai and Bangalore to Goa routes for the travel period from June 12-October 25, 2014. The customers looking forward to fly with AirAsia can book their tickets through www.airasia.com from May30 – June 1, 2014. Air Asia would be having its inaugural flight on June 12 with airline code ‘I5’.
On the pricing strategy which is likely to raise a few eyebrows in the Indian Aviation industry, AAIPL CEO Mittu Chandilya was quoted as saying, “I’ve promised that AirAsia India will make quality travel affordable to all and that we will revolutionize the Indian aviation sector. In keeping with that promise, I am excited to be able to celebrate the launch of the AirAsia India experience with a surprise promotion. The goal is to enable guests who have never flown to take this opportunity to come and experience flying the AirAsia way.”
This move of AirAsia has started a price war in the already bleeding aviation sector with SpiceJet announcing a promotional fare of Rs.1,499 on these routes from June 12. If this price war continues it would be bad news for the Indian aviation industry since for the last seven years carriers operating in India have lost a combined USD 10.1 billion according to Centre for Asia Pacific Aviation (CAPA) report.