SpiceJet heavy discounts boost flight bookings by 300%

The beleaguered carrier, Spicejet’s is back with delightful offers for the air travellers. And this has resulted in a spurt of flight bookings on online travel portal.

“With flight ticket prices lesser than train fares from SpiceJet, this is by far the best deal for travellers this year. SpiceJet is looking to aggressively regain market share and we have seen their bookings on our website grow exponentially by over 300%,” said Sharat Dhall, president of Yatra.com.

He further added, “Sectors like Goa, Kerala, Pune and Hyderabad as well as intra-metro routes have seen the most bookings. We expect SpiceJet bookings to continue to grow in the next couple of days and anticipate other airlines to follow suit with offers of their own.”

The carrier, which went through a serious financial crisis by the end of 2014, has once again come up with flash sale, this time selling the tickets lower than the railways. Spicejet is now offering tickets at Rs 599.

However, questions are being raised about the feasibility of the flash sale especially at a time when the airline is going through a financial crunch.

“It is misconception to say that discounted prices are not a feasible idea for the airline. Low-cost carriers across the globe come out with such offers and they are still in existence. According to IATA, Indian domestic market grew 6% in July year-over-year and we feel that market stimulation efforts led by us had some contribution toward this growth,” a SpiceJet spokesperson told BI India in an email response a while back.
Reiterating a similar sentiment, aviation expert Amber Dubey noted that flash sales of air tickets actually help a carrier recover the cost incurred on seats that generally fly empty on a route.

“Flash sales of air tickets are a good way to stimulate buying, bring in non-flyers and sell unsold seats, which are anyways likely to remain unsold in non-peak hour flights. The cost structure of airlines is mostly of a fixed nature–fuel wages, airport charges, aircraft lease and maintenance among others. The incremental cash that flash sales generate helps defray part of the fixed cost. Flying an empty seat is the biggest pain-point for an airline”, added Dubey.

BI India feels that while it may be an attractive proposition for the air passengers, it would be interesting to see which Indian carriers follow suit and offer such heavy discounts on their tickets.