AirAsia to pull out another India flight

New Delhi: AirAsia Bhd’s Thai unit will scrap its flights from Kolkata in March, the fourth Indian city from which Asia’s largest airline will withdraw in as many years, even as its Indian unit plans to start operations early next year.

Thai AirAsia will discontinue the Kolkata-Bangkok service from March because the company is losing money on this, said a person familiar with the matter, who declined to be named. AirAsia confirmed that the service will be withdrawn.

“Effective from January-February 2014, Thai AirAsia will alter the frequency of its Kolkata-Bangkok flights from daily direct flights to four flights per week,” an AirAsia spokesperson said in an email. “Thai AirAsia will no longer operate direct flights between Kolkata-Bangkok, starting from 1 March 2014 onwards.”

AirAsia, which entered its fifth year of operation in India in 2013, announced this week that it is offering limited all inclusive fares starting at Rs.2,259 from Kochi to Kuala Lumpur; Rs.2,704 from Chennai to Bangkok and Kuala Lumpur; Rs.3,269 for Bangalore to Kuala Lumpur. The airline will also keep flying to Kuala Lumpur from Kolkata with fares starting at Rs.3,228.

AirAsia had scrapped its flights from Mumbai and New Delhi in 2012 and from Hyderabad a year before that.

It has become difficult for AirAsia to maintain its service on the Kolkata-Bangkok route as more than 50% of the traffic on this route is accounted for by traders who are extremely price conscious and do not like to pay extra for meals, seats or baggage, the person cited above said. AirAsia charges extra for availing these facilities.

On this route, Malaysia-based AirAsia is competing with Jet Airways (India) Ltd and Thai Airways, which provide all the services without any additional charges, and low-fare carrier IndiGo.

The fare for a 3 December one-way flight from Kolkata to Bangkok on AirAsia was Rs.7,586, higher than IndiGo’s Rs.6,530 while Jet Airways sold tickets for Rs.10,300 and Thai Airways for Rs.18,742.
Budget airline IndiGo withdrew its Mumbai-Singapore and Delhi-Singapore flights earlier this year, with analysts attributing the withdrawal to their unviability.

AirAsia India hopes to start operations early next year in what may be a test case for an airline that seeks to lure passengers by selling cheaper tickets after the grounding of Kingfisher Airlines Ltd.

“AirAsia India will definitely do well but they have to give time for anything to settle. Initially, no one wanted to fly Kingfisher but once they tasted Kingfisher, they never went anywhere else. AirAsia also has to stop talking to machines, have sales people do calls, be agent friendly and not cancel flights,” said Kolkata-based Anil Punjabi, chairman (eastern chapter) of Travels Agents Federation of India.

“We will still appeal to AirAsia to retain Kolkata-Bangkok,” he said. “If we can’t sell Bangkok from here, we can’t sell anything.”