Sunday, June 23, 2024

Navigating New Horizons: Air India’s Strategic Expansion into Australasia

By Staff Correspondent 

In a bold play to expand its international footprint, Air India is set to launch a tri-weekly non-stop service between Mumbai and Melbourne, commencing on 15 December. Despite the typically extensive lead time required for long-haul routes to garner awareness and drive ticket sales, Air India has taken an audacious approach, announcing the route six weeks in advance. The airline is banking on its established presence in the Australian market to counteract the truncated promotional period.

Mumbai to Melbourne: A Strategic Connection

The new route is emblematic of Air India’s ambitious trajectory under its revitalised leadership, utilising the 256-seat Boeing 787-8 for the thrice-weekly flights. Analysts speculate that the airline has reallocated aircraft from the discontinued Delhi-Amsterdam route or transitioned some of its London Heathrow services to the larger 777, thereby freeing up the necessary equipment.

With approximately 105,000 roundtrip point-to-point (P2P) passengers recorded in the 12 months leading up to August 2023 and a 45% increase in traffic compared to pre-pandemic levels in 2019, the Mumbai-Melbourne corridor has exhibited significant growth. Extending the lens to encompass all of India, Melbourne has attracted over a million passengers, highlighting the substantial and expanding market potential.

Complementing its existing daily Delhi-Melbourne service, Air India’s latest route is strategically positioned to capture a larger share of domestic passengers, with Mumbai’s advantageous location playing a crucial role. This development mirrors Qantas’ partnership with IndiGo to initiate services to Bengaluru, another geographically favourable hub. Furthermore, Air India is poised to more effectively tap into the European passenger market, particularly from London Heathrow.

Exploring Future Horizons: Potential Routes in Australia and New Zealand

Notably unrestrained by bilateral agreements, Air India may next set its sights on a Mumbai-Sydney route, potentially operating three times a week and requiring a dedicated aircraft for the service. Data indicates that Sydney represents a larger Mumbai P2P market compared to Melbourne, complementing Air India’s existing daily operations between Delhi and Sydney.

Meanwhile, the India-New Zealand travel corridor has seen over 390,000 passengers, with Delhi-Auckland alone accounting for roughly 203,000, underscoring a significant market ripe for direct connectivity. Although the distance is formidable, surpassing even the Delhi-San Francisco route, the forthcoming introduction of Air India’s Airbus A350s could pave the way for this long-haul venture.

Air India’s latest route addition is a calculated risk, embracing a short lead time in favour of seizing market opportunities and reinforcing its presence in the Australasian region. With a strategic focus on geographic advantages and market demand, the airline is poised to navigate new horizons and solidify its international standing.

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