An Overview of Low-Cost Carriers' Growth and its Impact on Airport Operations and Pricing

With the arrival of technological advancements, the aviation industry has undergone a massive transformation over the years. India has in recent times seen a significant growth in the number of budget-oriented domestic airlines apart from the state-controlled ones accommodating low-cost air travel. This has seen an upsurge in passenger numbers, allowing the budget carriers to tap into the huge potential the Indian aviation market has to offer so as to make air travel more affordable. Consequently, airport operations and the pricing model of the airports have also been affected.

Apart from the surge in the number of budget-oriented domestic airlines major airlines, such as Air India, Indigo Airlines and Air Asia are also driving their costs down to better accommodate inexpensive air travel. To keep up with the competition and stay afloat, airport operations and prices have been changed to suit the demand for low-cost travel.

In this list, we discuss the top 10 ways in which the growth of low-cost carriers has impacted airport operations and pricing in India.

1. Low Estimation of the Demand for Flights

In the past 10 years or so, there has been a massive surge in the number of passengers flocking to airports in India. This has consequently resulted in a higher demand for flights, meaning that airports had to quickly upgrade their infrastructure and services to meet the needs of the customers. To ensure that the vast majority of customers remain satisfied, airports had to extensively plan their operations and pricing structure.

As the flight demand grew rapidly, so did the need for more jets and therefore more space to accommodate them. This subsequently resulted in an increase of prices at airports, as they had to be able to afford the costs of the construction and expansion.

2. Airports That Aren’t Centrally Located

With the growth of low-cost carriers, many users are now opting to use airports that aren’t located centrally for their convenience and cost. The difference in pricing may not be as huge in certain areas, but airports that are located outside the main city still have much lower operating costs and therefore offer much lower prices for their services and flights. To keep up with the competition, other airports too have had to lower their prices in order to stay afloat.

3. Leveraging Low-Emission Technologies

The aviation industry is one of the highest contributors to air pollution in India, with many airports now adopting various low-emission technologies, such as hybrid systems and alternative structures, to reduce their carbon footprint. The growth of low-cost carriers also led to airports reaping the benefits of such environmental-friendly investments as they drastically reduce the cost of running these systems and make air travel much more eco-friendly.

4. Improved Quality of Services

One of the most visible impacts of the growth of low-cost carriers is the improved quality of services at airports in India. This includes improved check-in services, speedy baggage handling, airport Wi-Fi and better customer service. To meet the needs and demands of the increasing number of customers, many airports have opted to upgrade their operations and provide more efficient services to ensure the satisfaction of their customers.

5. Improved Safety

One of the most integral components of air travel is safety and with the growth of low-cost carriers comes the need for greater passenger safety. Many airports in India are now investing in modernised equipment, such as advanced security systems and maintenance services, to ensure that passengers and aircraft receive the services and protection they need. Maintaining compliance with international safety standards is now a priority for these airports.

6. Greater Investment in Technology

With the rise of low-cost carriers, many airports have had to upgrade their IT systems and make use of the most advanced technology in order to maintain their competitive edge in the industry. This is for the purpose of providing superior quality services to their customers as well as streamlining administrative operations. Airports are now investing in modern technologies, such as AI and machine learning systems, to be able to provide faster, more efficient, and more cost-effective services.

7. Digital Passengers

The growth of low-cost carriers has also sparked an increase in the number of digital passengers in India. Digital passengers are those that prefer to do their check-in, baggage handling, and boarding via digital avenues, as opposed to the traditional method of physically visiting the airport. Airports in India are now investing heavily in digital infrastructure so as to be able to accommodate the growing number of digital passengers, as well as meet their service expectations. These airports are now offering digital check-in services and integrated systems for boarding and departure.

8. Improved Customer Relationship Management (CRM)

The growth of low-cost carriers has also seen an improvement in the customer relationship management of airports in India. Airports are now investing in advanced CRM systems that are able to collect and analyse customer data, such as preferences, flight schedules, and ratings, to provide a much better service to customers. Airports are therefore making use of the data gathered to gain a better insight into the customer’s needs and how they can be better accommodated.

9. Increased Efficiency

The surge in the number of passengers due to the arrival of low-cost carriers has also improved the efficiency of airports in India. Airports are now making use of modern technologies, such as automation and robotics, to streamline their operations and make the process of handling passengers much faster and smoother. As a result of the increased efficiency, airports are now able to accommodate more passengers and provide them with a smoother and faster travel experience.

10. Improved Convenience

Last but not least, the growth of low-cost carriers in India has improved the convenience of air travel. Airports are now offering a range of services to ensure that customers are able to travel with ease and enjoy a fuss-free experience. This includes quick check-in systems, shuttle services, and a variety of food and entertainment options. These services aim to make the journey stress-free, allowing customers to focus on the more important aspects of their trip.

Conclusion

To summarize, the growth of low-cost carriers has had a considerable impact on airport operations and pricing in India. Airports have had to upgrade their infrastructure and services to better suit the needs of customers and remain competitive in the industry. The introduction of digital and automated technologies has improved the quality and efficiency of services, allowing airports to better accommodate the growing number of passengers. Furthermore, improved safety systems, increased convenience, and better customer relationship management have also been observed in recent times.

Frequently Asked Questions

Presented below are the responses to frequently asked questions regarding the growth of low-cost carriers and its implications on airport operations and pricing.

How have low-cost carriers impacted airport operations and pricing in India?

The growth of low-cost carriers has had a considerable impact on airport operations and pricing in India. As a result of the increase in passengers and the need to remain competitive, airports have had to upgrade their infrastructure and services, such as through the introduction of digital and automation technologies, as well as improved safety systems and better customer relationship management.

What are some of the ways in which airports are able to reduce their operational costs?

Airports are now making use of a variety of techniques to help reduce their operational costs. This includes the leveraging of low-emission technologies such as hybrid systems and alternative structures, switching to airports that aren’t located centrally, and the introducing of digital passengers. By doing so, airports are able to reduce their operational costs, allowing them to offer lower prices to their customers.

What are some of the ways in which airports are improving customer experience?

Airports are now offering a range of services to improve customer experiences, such as quick check-in systems, digital check-in services, and integrated boarding systems. Airports are also making use of modern technologies, such as AI and machine learning systems, as well as improved customer relationship management systems to provide better services and an overall better travel experience.