Over the last couple of years, I have always been interested in tracking “something new”, “something different” in the market. That is one reason, why I write only when I can add “Knowledge” and not just “information”.
I was shocked to see IndiGo foray into Vietnam from Kolkata. While traffic between India and Vietnam has been growing at a steady rate, the two largest markets are Delhi and Mumbai. Anecdotal evidence has shown that the flights do not have very good loads. But again, loads are rarely a true picture of how well the flights are doing financially. The airline which had its focus on Kolkata from early days of operation has got the city back in limelight when the focus for the airline is international connectivity.
If you are a student of aviation like me, this is our chance to see how a hub and spoke model takes shape in real life. This will give immense insights into Network Planning in general and hub-spoke model in particular.
Last year, IndiGo went on an expansion spree on the international side, launching station after station and flight after flight. The focus was more on the east with launch of Yangon, Hanoi, Ho Chi Minh City, Guangzhou as new destinations. The airline had plans of connecting the Buddhist circuit.
There hardly was any connectivity between the flights to Vietnam and the Buddhist circuit. But the flights connected very well to the entire domestic network – Delhi, Mumbai, Bengaluru, Chennai, Hyderabad, Ahmedabad, Pune and more! However, I remained sceptical about the flights and add to the challenge, Vietjet launched flights from both Hanoi and Ho Chi Minh City to New Delhi!
IndiGo quickly moved the flights to Ho Chi Minh City from day-time to red-eye and as the booking engine shows, even the flights to Hanoi move to red-eye in summer schedule 2020. Even flights to Yangoon will be moved to red-eye arrival and departure in Yangon, while those to Guangzhou were already operating in this manner. Recently, the airline announced the launch of flights to Dubai and Doha from Kolkata.
With the changes in timings to Hanoi, Ho Chi Minh City and Yangoon and the launch of Dubai and Doha, there is a seamless two-way connectivity being provided from Hanoi, Ho Chi Minh City, Yangon, Singapore, Bangkok and Gunagzhou with Doha and Dubai in addition to a host of destinations in India like Delhi, Mumbai, Bengaluru, Hyderabad, Chennai, Ahmedabad, Pune and more!
Competition is never kind, for the same dates for which the flight schedule was pulled out, IndiGo was only INR 2000 cheaper than a non-stop by IndiGo from Ho Chi Minh City to Dubai and return, but IndiGo fares were INR 24,000 cheaper to Doha from Ho Chi Minh City as compared to any other option, searched for the same dates on the same source.
A word of caution
The flights are now revolving around connecting passengers from one side to another at Kolkata. But the connecting passengers are the least yielding ones! The basics of Network Planning say that never plan a flight around connecting passengers. The planners from airlines in the Gulf who have built a fortune connecting passengers will also agree when I say it never is A to C via ME, it always is A to ME, C to ME and then some A to C via ME!
While Indians love red-eye flights since they are cost effective, the ones to Europe land during the morning hours and same is the case with those to Malaysia, Singapore and Thailand – in most cases.
With the new timings of IndiGo – the passengers will end up in Vietnam in the dead of the night! While the airport is Ho Chi Minh City is fairly close to the city, the same is not the case in Hanoi and from India to ASEAN; every country has its own story of taxi mafia, taking away attractiveness for the traveller.
IndiGo is cash rich and has a fleet of over 250 aircraft. There is no doubt that the airline has to try something new to stay relevant and grow and there is only as much that can be done in Indian skies, so it has to look out for growth rather than inwards. Yet, the re-invention has to be positive in terms of cash generated.
Every airline has its share of good and bad routes and ends up closing stations and routes. IndiGo has a unique distinction of not having closed a single station and there will be a lot of pressure to maintain that record. Did the airline jump a little too early into Vietnam or was the Indian point a wrong one? I continue to remain sceptical about the choice of Kolkata for flights to Vietnam!