|
INDIA
BUSINESS WORLD -
OCTOBER 2005
THE MONTH THAT WAS
KINGFISHER TIES UP WITH AIR DECCAN
Kingfisher Airlines
has signed up with Air Deccan to buy out the Bangalore-based,
low-cost airline's extra available seat kilometers (ASKMs)
on category 2, 2A and 3 routes. The Vijay Mallyapromoted airline
will buy about 800,000 ASKMs for October and November, which
will enable it to continue its expansion on metro routes.
The Directorate General of Civil Aviation (DGCA) guidelines
require airlines flying on primary routes to deploy a certain
percentage of their total flights on less popular routes.
`The agreement
for ASKMs is likely to be extended later for a longer period,''
Air Deccan CEO G R Gopinath said. It is not clear how much
Kingfisher is paying Air Deccan for the additional ASKMs,
but the figure is thought to be in the region of Rs 2 per
km.
ASKM is defined
as the number of available seats multiplied by the distance
flown. Kingfisher already has a similar agreement with Indian
Airlines to buy surplus ASKMs across the three categories.
Airline routes in India are divided into four categories.
Category 1 routes, which are 12 specified routes linking most
metros. Airlines which fly, say, 100 ASKMs on these routes
are required to fly 10% of these (i.e. 10 ASKMs) on category
2 route, which includes routes in the Northeast, Jammu &
Kashmir and Andaman and Nicobar. The airlines are also required
to fly 50% of their category 1 routes on category 3 (50 ASKMs),
which include all routes apart from those specified in category
1 and 2.
|
