Report on

Jet Airways
&
Paramount Airways

Submitted To:

Dr. Jomon Lonappan

Faculty,SDMMBA

Submitted By:

Muralidhar Baliga Neethi Nithyanand Varsha Ballal

Shwetha Gujaran Laneza Lobo

INTRODUCTION
Airline Industry in India is one of the fastest growing aviation industries in the world. With the
liberalization of the Indian aviation sector, airline industry in India has undergone a rapid
transformation. From being primarily a government-owned industry, the Indian airline industry
is now dominated by privately owned full service airlines and low cost carriers. Private airlines
account for around 75% share of the domestic aviation market. Earlier air travel was a privilege
only a few could afford, but today air travel has become much cheaper and can be afforded by a
large number of people.

The origin of Indian civil aviation industry can be traced back to 1912, when the first air flight
between Karachi and Delhi was started by the Indian State Air Services in collaboration with the
UK based Imperial Airways. In 1932, JRD Tata founded Tata Airline, the first Indian airline.

Airline organizations can be classified into a number of segments depending on the nature and
degree of services they provide. Major Indian carriers are pressing their feet on the accelerator to
reach an acme of service level by the year 2010 when their fleet strength will meet 500 to 550. In
the previous two years more than 135 aircrafts have been introduced to keep up with the
increasing number of passenger traffic in Indian aerospace. A number of domestic airline groups
have emerged in a reasonably short span of time to make the market furiously competitive.

IMPORTANCE
Growing tourism:
Due to growth in tourism, there has been an increase in number of the international and domestic
passengers. The estimated growth of domestic passenger segment is at 50% per annum and
growth for international passenger segment is 25%. Airlines play an important role in
international tourism. Developing airline services helps the nation to cash on tourism as more
than 85% of the foreign tourist arrives by air.

Improving Infrastructure:
We all know that India's air transport infrastructure is out-of-date. In fact the overall situation is
critical. A recent report by McKinsey suggests that half of India's highly qualified graduates are
located in cities without international airports. Without massive change, infrastructure will not be
able to handle growth.
Globalization:
Globalization has improved the lives of many in developing nations. Globalization in of its self is
the trading of goods and services of a local economy into an integrated global economy.
Technological advances have made this practice more feasible within the last 50 years. The
major milestones were the development of the internet and increased transportation technology.
These two advances made the world coined "flat" and set the stage for higher living standards.

PRESENT SCENARIO
Revolutionized by privatization along with active participation of the foreign investors, the
Indian airline industry has experienced phenomenal transformation over the last couple of years.
From being a service catering to the needs of the privileged group only it is now well within the
reach of middle class population. This has been the result of increased competition in the Indian
aviation industry due to the presence of a wide variety of private and public airlines with their
low price tags. It was further helped by the entry of Air Deccan, the first budget airline in India,
offering unbelievable tariffs to the customers.
In the financial year 2006-07 there has been a significant 22.3 percent growth in passenger traffic
in the domestic airports while the aircraft movement recorded a growth by 14.2 percent.
In terms of the number of flights Jet Airways secures the top position with 8,168 flights
operating till June 2007. Indian Airlines is in second position with 7,562 flights. Sahara (3,225
flights), Air Deccan (2,889 flights), Spice Jet (483 flights) and Kingfisher Airlines (367 flights)
come thereafter in the list of domestic and national carrier operators.
 0.15 0.17 NACIL (I)
0.06 Jet Airways
0.02 JetLite
0.12 0.19 Kingfisher
Spicejet
0.23 Paramount
0.07 Go Air
IndiGo

The domestic market share chart for the Indian aviation industry
Introduction to Jet Airways
Jet Airways, which commenced operations on May 5, 1993, has within a short span of 17 years
established its position as a market leader. It's one of the fastest growing airlines in the world,
and now it's all set to change the way you fly - for the better!
The airline has had the distinction of being repeatedly adjudged India's 'Best Domestic Airline'
and has won several national and international awards.
Jet Airways flies to 65 domestic and 20 international destinations span the length and breadth of
India and beyond, including New York (both JFK and Newark), Toronto, Brussels, London
(Heathrow), Hong Kong, Singapore, Kuala Lumpur, Colombo, Bangkok, Kathmandu, Dhaka,
Kuwait, Bahrain, Muscat, Doha, Riyadh, Jeddah, Abu Dhabi and Dubai. Jet Airways is the most
preferred domestic airline in India. It is the automatic first choice carrier for the travelling public
and sets standards, which other competing airlines will seek to match. Jet Airways will achieve
this pre-eminent position by offering a high quality of service and reliable, comfortable and
efficient operations. Jet Airways will achieve these objectives whilst simultaneously ensuring
consistent profitability, achieving healthy, long-term returns for the investors and providing its
employees with an environment for excellence and growth.
Since the acquisition of Air Sahara (renamed as Jet Lite) in April 2007, Jet Lite is a wholly
owned subsidiary of the company. Jet Lite currently operates a fleet size of 24 aircrafts flying to
31 destinations within India & operating around 127 flights daily. It also flies to Colombo &
Kathmandu.
Naresh Goyal (60), the founder Chairman of Jet Airways, has over 38 years of experience in the
Civil Aviation industry. He is the recipient of several national and international awards.
In 1991, as part of the ongoing diversification programme of his business activities, Mr. Naresh
Goyal took advantage of the opening of the Indian economy and the enunciation of the Open
Skies Policy by the Government of India to set up Jet Airways for the operation of scheduled air
services on domestic sectors in India. Jet Airways commenced commercial operations on May
05, 1993.
In these 17 years, Jet Airways has emerged as one of India's largest private domestic airlines, and
has been acclaimed by frequent travellers as the most preferred carrier offering the highest
quality of comfort, courtesy, standards of ground and in-flight services and reliability of
operations. Jet Airways currently operates a fleet of 10 - Boeing 777-300 ERs, 48 New and Next-
Generation Boeing 737s, 12 Airbus A330-200 aircraft and 14 ATR72-500s turbo-prop aircraft. 

Mission Statement
Jet Airways will achieve this pre-eminent position by offering a high quality of service and
reliable, comfortable and efficient operations. Jet Airways will be an airline which is going to
upgrade the concept of domestic airline travel - be a world class domestic airline. Jet Airways
will achieve these objectives whilst simultaneously ensuring consistent profitability, achieving
healthy, long term returns for investors and providing its employees with an environment for
excellence and growth.

Jet Airways Network

Pricing

Pricing decisions play a decisive role in managing the business of air transportation. The
increasing operational costs, the mounting competition, the falling occupancy ratio, the imbalances
in demand and supply, the increasing pressure of inflation are some of the important factors
influencing the strategic decisions for setting fare and freight rates in the air transport business.
The Ministry of Tourism and Civil Aviation, the Indian Airlines Corporation, the National Airports
Authority, the International Airports Authority of India, the Air India Corporation are the bodies
directly or indirectly influencing the process of making the pricing decisions. The main problem is
to make the pricing decisions competitive because it is found that even the private air transport
organizations are involved in the process too. It is seen that the following are the features in price
i.e.: 1.Flexibility; 2. Price Level; 3. Differentiation; 4. Discounts and Allowances.
While price is tactical, it has localized implementation, it is temporary in nature and therefore price
is flexible.
The below is an article from the Business Standard issue of 1 st October-02 which shows how fares
have lessened and what are the additional benefits which are being provided to the customers.

IA takes fare war to Jet’s turf…extends sops to peak season

Domestic carriers have been successful in increasing their load factors, following an increase in
takers for airline schemes that offer passengers huge discounts (nearly 50 percent in certain
sectors). Though the bottom lines of airlines have improved, this phase will last only till the end of
the lean season. (October) in most cases. There had been a decline in passenger load post-11
September, but these schemes have been able to retain loads. With all major domestic airlines –
Indian Airlines (I-A), Jet Airways and Sahara- announcing various schemes to lure passengers, it
would not just lead to displacement of passengers from each other’s airlines but also encourage
those traveling by rail or road top travel by air.

More good news for air travelers. Indian Airlines (IA) has announced a revised apex fare scheme
with effect from November 1 to March31 2003 thereby extending the early bird scheme to the
peak season. Under the new scheme covering 53 destinations, the advance booking period has
been reduced from 21 days to 15 days. Cancellation and refund rules have also been relaxed and
the passengers can now change their reservation plans or get refund at least 15 days prior to the
date of travel after paying a minimal charge of Rs.100 per ticket.

The new fares, to be effective from November 1 of this year see a Rs.520 or 13.25 percent drop on
the Delhi-Mumbai sector. The new IA fare of Rs. 3,400 is 6 percent lower than a Delhi – Mumbai
Jet Airways ticket cost Rs.3,620. The gap between an AC first class Rajdhani ticket and an IA
economy ticket on the Delhi-Mumbai route had widened with the rail fare 19 percent costlier at
Rs.4,180. the AC-II tier Rajdhani ticket at Rs.2,045 is, however nearly 30 percent cheaper.
Till now, the airline has been offering around 12-13 per cent of the total economy class seats under
the apex fares scheme, the officials of IA added. Around 2,500 seats a day was being offered under
the scheme out of 2000 economy class seats in 50 destinations where the scheme is valid. “We
have managed to convert the first class train traffic and create a new segment altogether. While the
seat factors increase to 65-70 per cent during the peak season, the additional traffic would only
contribute towards a higher seat factor without much effort,” IA officials said.
The airline has been flexible on the availability of seats under this category and based on its
analysis of the demand-supply, traffic profile of the route and cost benefit analysis, it has been
varying the number of seats offered under the scheme. During the lean season (August-October), it
has often offered close to 3,000 seats of the available 20,000 seats a day in the economy class. All
categories and routes taken together, IA has a capacity of around 34,000 seats a day. The airline’s
revenue from business traffic is around 80 per cent, while that from leisure traffic accounts for 20
per cent.
Jet Airways has also decided to cut the number of seats offered under the Apex scheme. The
airlines have slashed the number of seats offered per flight under the scheme from 15 per cent to
10 per cent. Senior Jet officials said the airline would offer 40 per cent lesser seats daily across its
network, than what was offered during the August-September period. The airline was offering
approximately 3,000-4,000 seats on its Apex scheme during the last two months.

Range includes:
Economy & Club Premiere Fare Discounted fare for senior citizens & defense personnel
Advance Passenger Excursion/ APEX Fares One Fare Night Saver Fares Check Fares US Dollar
Fares & Visit India Fares.

Marketing

J  e  t   A i r  w a y s   C  i  t  i  b a n k   G o l d   C a r  d 

They now offer our Jet Privilege members an opportunity to earn free flights even faster with the
Jet Airways Citibank Gold Card. In association with Citibank N.A. and MasterCard
International, this is the country's first co-branded credit card.

At Jet Airways we understand that our overseas passengers have special needs. So whether you
have to catch a connecting flight, retrieve your baggage, transfer between airport terminals, or
even check flight schedules, we are equipped to offer you all the information and assistance that
you might need to make your journey more pleasant and comfortable.

At Jet Airways we realize that some of their passengers require special attention. Young children
can get quite restless on a flight, while our senior passengers may need some assistance. We thus
offer a host of services tailored to their special needs.
 Senior Citizens
 Unaccompanied Minors
  Disabled Passengers
We are also proud to be the first domestic airline in India to run a special program called 'Jet
Kids' for the children on our flights.

S  e  n i o  r   C i t i z  e  n s 

Senior Citizens can avail of travel concessions on Economy Class on all the sectors Jet Airways
operates. Passengers above the age of 65 years are entitled to a concession on the basic airfare.
This concession is available in Indian Rupees for Indian nationals and in US Dollars for foreign
nationals.
To avail of this concession, just fill out the “Concession Form” and submit it along with a
photograph and your proof of date of birth. They also have special wheelchair facilities for our
elderly and disabled passengers. If you need any assistance, please do not hesitate to approach a
member of our staff.

J  e  t   K i d s 
Jetkids is our special programme for the younger patrons of Jet Airways. Children between the
ages of 2 to 12 years need not just look forward to the excitement of flight take-off and landing,
for we also have other surprises for them. There are exciting gifts for children on board, to
occupy their agile minds.

J  e  t   E l i t e 
Your boarding pass also takes care of your lodging…
Jet Airways, India’s favourite domestic airline, brings you JET ELITE, a unique offer that turns
your boarding pass into a lodging pass at some of the best hotels across the country. All you need
to do on your next business trip is check your schedule, and refer to our city-wise list of
participating hotels. Then, just show your Jet Airways boarding pass at the reception counter of the
hotel in which you choose to stay to avail of fantastic discounts and offers. They also have special
offers to our JP Gold and Silver Card members.

Marketing Strategies
 Frequent Flier Programme
 Known as JetPrivilege it helps to redeem points earn for miles traversed.
  Jet Mall
 This is the unique mall provided by the Jet Airways to shop souvenirs at 30000 feet.
 Jet Wings
 Jet Wings is the inflight magazines.
 Jet Travel
 Jet has alliance with a number of hotels Such as Leela and Taj where the passengers can
get discounts if they are privilege members of the Jet.
 They provide special service for infants, olds, medical emergencies, expectant mothers
and animals. Check in can be done by SMS, on Net, and Kiosks. Their Website has the
option to choose from a plethora of language to cater to understanding of people from
different parts of world.

Communication:
 Advertisements in newspapers, business magazines, etc.
 Sponsorship to various events.
 Loyalty programs.
Introduction to Paramount Airways
Paramount Airways is a private domestic airline of India, based in Chennai. The airline was
launched on October 19, 2005, by Paramount Group, a leading Indian textile manufacturer based
in Madurai (Tamil Nadu). The headquarters of Paramount Airways is located in Coimbatore. The
airline operates scheduled flights, mainly targeting business and leisure travelers. It promises to
provide exceptional value for money, unparalleled comfort and convenience to its passengers,
every time they are on board.
Paramount Airways plies flights directly to some of the well known commercial hubs of India,
thereby connecting them to the metro cities of the country. Thus, it has marked its presence in
the metropolitans of India. It offers several value added services, such as, valets to assist the
passengers in boarding the plane, gourmet meals and a range of in-flight services and
entertainment. Paramount Airways has number of firsts to its credit. It is the first airline in India
to launch the New Generation Embracer 170/190 Family Series Aircrafts. It is the first to offer
full business class services, but at prices that are equivalent to the economy class fares of other
carriers.
Paramount Airways is the premium service schedule airline, offering first time direct services to
a number of commercial Hubs in India, connecting them to metropolitans across the country. The
airline covers 16 destinations across India, including Bangalore, Chennai, Cochin, Coimbatore,
Trichy, Hyderabad, Visakhapatnam, Madurai, Kochi, Thiruvananthapuram, Delhi, Guwahati,
Goa, Ahmadabad, Agartala and Kolkata. The airline consists of a fleet with 5 aircrafts - 2
Embracer E170 and 3 Embracer E175.
Paramount Airways aspires to mark its international presence, by plying flights to international
destinations, including the European cities Rome, Vienna, London and Paris. The airline also
targets Middle East and Far East destinations including Singapore, Kuala Lumpur, Hong Kong,
Bangkok and Seoul. Before launching its services to United States, Paramount Airways is aimed
to cater to ply flights to other Asian and Gulf countries as well. The international flights provided
by the airline would not consist of economy class, with wide-body aircraft custom made for the
purpose.
Today, India has one of the fastest growing aviation sectors in the world. With the liberalization
of the Indian aviation sector, the aviation industry in India has undergone a rapid structural
change. It has experienced tremendous growth not only in passenger and cargo traffic but also in
the number of aircrafts and airlines.

Pricing
Price plays as much a tool of marketing as promotion plays a critical role in the marketing mix.
The concept of 'fair price' is paramount. Buyers judge whether a product is fairly priced by
seeing whether it represents value for money.

Pricing Strategies
1. Premium Pricing:
The airlines may set prices above the market price either to reflect the image of quality or the
unique status of the product. The product features are not shared by its competitors or the
company itself may enjoy a strong reputation that the 'brand image' alone is sufficient to merit a
premium price.
2. Value for Money Pricing:
The intention here is to charge the average price for the product and emphasize that it represents
excellent value for money at this price. This enables the airline to achieve good levels of profit
on the basis of established reputation.
3. Cheap Value Pricing:
The objective here is to undercut the competition and price is used to trigger the purchase
immediately. Unit profits are low, but overall profits are achieved. Air India and Indian Airlines
have slashed their prices to meet the competition of private airlines so that they can consolidate
their position in the market.

Airlines usually practice differential pricing. There are three classes: The First Class, The
Executive or Business Class and The Economy Class. Fares for each class are different since the
facilities provided and the comfort and luxury level is different in each class. Seasonal fares are
also fixed, fares rise during the peak holiday times.
4. Low-cost Pricing:
With the advent of the low-cost airlines in the Indian aviation industry, a different low-cost
flying concept has come up. Since these low-cost airlines are trying to woo the customers by
providing air travel in exceptionally low prices, a price-band kind of pricing has to be designed.
In low-pricing strategies, the airlines provide very low prices for the flight tickets. Also, they
prices are made cheaper by booking the tickets long before the flight date.

Marketing strategies
Paramount has started the Paramount Royal membership which allows the fliers to redeem points
earned corresponding the mileage. Accrued points can be redeemed for free air travel, benefits,
privileges and upgrades across Paramount Airways flights.
They provide e check in facility, booking of tickets by credit cards.
They have also tied up with a number of hotels of all ranges and help the fliers to book them
online through their website.
They have won the “Arch of Europe” award recently.

Communication:
 Advertisements in newspapers, business magazines, etc.
 Sponsorship to various events.
 Loyalty programs.

CONCLUSION
Airline industry in India is plagued with several problems. These include high aviation turbine
fuel (ATF) prices, rising labour costs and shortage of skilled labour, rapid fleet expansion, and
intense price competition among the players. But one of the major challenges facing Indian
aviation industry is infrastructure constraint. Airport infrastructure needs to be upgraded rapidly
if Indian aviation industry has to continue its success story. Some steps have been taken in this
direction. Two of India's largest airports-Mumbai and New Delhi-were privatized recently. Two
Greenfield airports are coming up at Bangalore and Hyderabad in southern India. Investments
are pouring into almost all aspects of the industry, including aircraft maintenance, pilot training
and air cargo services. The future prospects of Indian aviation sector look bright.

The Indian aviation industry has witnessed remarkable growth in recent years, with key drivers
being positive economic factors, including high GDP growth, good industrial performance, and
corporate profitability and expansion. Other factors include higher disposable incomes, growth in
consumer spending, and availability of low fares.