Aviation industry has been facing big losses and rising expenses, and the minister suggested a way out. At Outlook Business Leading Edge 2019, he advised not getting involved in “unproductive” competition.
Minister of Civil Aviation, Urban Affairs and Housing, Hardeep Singh Puri, recalled the example of Japanese watchmakers, who he met during his time in the Indian Foreign Service as a young language officer in Tokyo. He asked them how they expected to compete with Swiss manufacturers who have years of experience. One of the watchmakers told him that they sat down with a map of the world and divided it into three markets, one for each of the three Japanese manufacturers. This model of sharing the market was perhaps meant as a suggestion for low-cost carriers because, he went on to add: “I have absolutely no doubt that if all four low-cost carriers sit together, there is enough money to be made for all four to be successful.” Throughout his speech, the minister spoke of how industry leaders can play a crucial role in the functioning of a healthy economy, reminding them that the present economic hardship has arisen also out of bad business practices.
While analysts have agreed that this race to lower prices, to gain more passengers, is costing airlines dearly, they also say that rise in jet fuel prices is also bleeding the sector. It is the biggest cost that an airline has to bear and rupee weakening against the dollar has not helped. About the fuel concern, the minister was less illustrative, saying briefly, “