Leisure travel among Indians poised to rise with budget flights to Europe, US

Low-cost long haul flights will be introduced as early as this winter. Source: Shutterstock

LARGE budget airlines from India like IndiGo and SpiceJet Ltd are drawing up plans for long-haul flights as far as Europe and the United States, boosting outbound leisure travel for the country.

An analysis by aviation consultant CAPA India and online travel agent Expedia Inc released on Wednesday says the launch of low-cost, long-haul flights by the country’s airlines will open a multi-billion dollar opportunity for the carriers.

The carriers have so far focused on shorter-range destinations such as Sri Lanka and Thailand.

Only 0.3 percent of Indians currently travel abroad for a holiday every year, a fraction of the estimated 100 million who could potentially afford to do so, CAPA’s analysis of household income shows. Most Indians travel for education, business or to visit friends and relatives.

Tourism spending by Indians could rise to as much as US$40 billion by 2027 from about US$16.4 billion in 2016, CAPA said, ranking it sixth in the world ahead of Canada, South Korea and Australia.

CAPA India CEO Kapil Kaul said at an aviation conference in Mumbai on Tuesday, citing its geographic location and a large order pipeline for new long-range narrowbody jets.

SpiceJet Chairman Ajay Singh said on Tuesday low-cost long-haul flights will be introduced as early as this winter.

An IndiGo Airlines aircraft prepares to land as a man paddles his cycle rickshaw in Ahmedabad, India. Source: Amit Dave/Reuters

IndiGo is exploring long-haul operations and seeking rights to routes, parent InterGlobe Aviation Ltd told analysts last week.

According to Ch-Aviation, IndiGo Airlines is looking to enter the market next winter with flights to Europe and the Far East, and has sought regulatory approval to start service from Delhi Int’l to each of London, Paris, Madrid Barajas, and Hong Kong Chek Lap Kok using A330 equipment.

The low-cost flights would compete against full-service Indian carriers Air India and Jet Airways as well as global rivals such as Emirates and Lufthansa.

Indian airlines have also placed orders for nearly 800 re-engined aircraft, such as Airbus A320neos and Boeing Co 737 MAX narrowbodies.

The jets, with longer ranges than predecessors, will enable low-cost carriers to launch non-stop routes to Asian destinations such as Phuket, Manila, Hong Kong, and Hanoi that are otherwise unviable today.

By 2025, Indian budget carriers will operate close to 40 wide-bodied aircraft, which could deliver an additional 2 million annual outbound leisure travellers to places such as New York and Sydney, CAPA said.

Additional reporting by Reuters