How Air India expects to double its revenue

Air India signed a code-share pact with Air Canada last September.

Air India has witnessed a significant rise in international travellers in its first year as member of Star Alliance.

Air India had become a Star Alliance member on July 11, 2014.

“Between last July and March (this year), we have seen an increase in passenger transfers from Star Alliance member airlines on our code-share flights.

"We expect code-share revenue to double to three per cent of passenger revenue once we sign more code-share alliances,” said Air India’s commercial director Pankaj Srivastava.

A majority of the existing transfers are from Air Canada (over London to Air India's Delhi and Mumbai flights) and from Ethiopian Airlines on Air India's domestic network. 

The national carrier records an average 4,000 transfer passengers daily at its Delhi hub.

These include passengers connecting on both domestic and international flights.

Air India is estimated to have earned Rs 15,450 crore (Rs 154.5 billion) from passenger revenue in FY15, according to its provisional numbers, registering a growth of nine per cent.

Air India signed a code-share pact with Air Canada last September.

It also expanded its existing agreement with Ethiopian Airlines to cover domestic routes in India and destinations in Africa.

Code share is an agreement between two airlines that helps enhance an airline’s revenue.

It allows an airline to put its code on a flight operated by a partner airline and sell tickets on routes where it does not operate.

Recently, Air India signed a code-share agreement with Air New Zealand and will soon be signing the pacts with LOT Polish Airlines and TAP Portugal Airlines.

Air India does not have a code-share agreement with United Airlines of the US and hopes to conclude a pact with it in the next few months.

By the end of this year, Air India will shift operations to terminal-2 in London Heathrow, which is used by other Star Alliance members.

This is expected to benefit the airline and make passenger transfers more convenient.

The carrier is also planning to launch a one-stop service between Delhi-Toronto via London.  

Star Alliance is the largest of three global airline alliances. Among the members are Lufthansa, Swiss, United, and Singapore Airlines.

ABOUT STAR ALLIANCE

• Star Alliance is a 27-member global airline alliance. It was formed in 1997
• AI became its member last July
• AI expects revenue gains from integration of its frequent flyer  programme with other airlines
• AI has seen a significant rise in international travellers connecting on its flights

Image: Air India mascot Maharajah; Photograph: Reuters