New Delhi: Indian airports need to review their pricing strategies and can substantially increase their profitability by earning more non-aeronautical revenue, according to aviation consultancy CAPA India.
India is the third largest domestic civil aviation market in the world and air traffic is increasing. Airlines are increasing their fleet, operating more routes and airports are also expanding their capacities.
Airports operated in Public Private Partnership (PPP) mode generate more non-aviation revenue compared to those operated by the Airports Authority of India (AAI), the consultancy firm said during a webinar on Thursday.
Just five PPP airports (Delhi, Mumbai, Bengaluru, Hyderabad and Cochin) accounted for 71 per cent of the total non-aeronautical revenue in India in fiscal 2020, while handling 53 per cent of the total traffic, CAPA India said.
Despite significant increases since privatization, Indian APP airports still have much more scope to increase non-aeronautical revenues at global levels, CAPA India said, adding that airports need to review their pricing strategies.
"Indian airports can substantially improve their profitability by increasing penetration of non-aeronautical revenue streams to get closer to the spending profile of Indian travelers," he said.
In addition, the consulting firm said that airports should consider whether airfares reflect the demand for airport resources and whether there could be greater differentiation based on the time of day, passenger profile, business model and frequency operated by The airline.
During the January-May 2024 period, domestic airlines carried 661.42 lakh passengers, as against 636.07 lakh passengers during the year-ago period, according to the latest official data.
Addressing the joint session of Parliament on Thursday, President Droupadi Murmu said, "India is the third largest domestic aviation market in the world," adding that in April 2014 there were only 209 air routes, which rose to 605 in April 2024. .
“This increase in air routes has directly benefited Tier 2 and 3 cities,” she added.
India is the third largest domestic civil aviation market in the world and air traffic is increasing. Airlines are increasing their fleet, operating more routes and airports are also expanding their capacities.
Airports operated in Public Private Partnership (PPP) mode generate more non-aviation revenue compared to those operated by the Airports Authority of India (AAI), the consultancy firm said during a webinar on Thursday.
Just five PPP airports (Delhi, Mumbai, Bengaluru, Hyderabad and Cochin) accounted for 71 per cent of the total non-aeronautical revenue in India in fiscal 2020, while handling 53 per cent of the total traffic, CAPA India said.
Despite significant increases since privatization, Indian APP airports still have much more scope to increase non-aeronautical revenues at global levels, CAPA India said, adding that airports need to review their pricing strategies.
"Indian airports can substantially improve their profitability by increasing penetration of non-aeronautical revenue streams to get closer to the spending profile of Indian travelers," he said.
In addition, the consulting firm said that airports should consider whether airfares reflect the demand for airport resources and whether there could be greater differentiation based on the time of day, passenger profile, business model and frequency operated by The airline.
During the January-May 2024 period, domestic airlines carried 661.42 lakh passengers, as against 636.07 lakh passengers during the year-ago period, according to the latest official data.
Addressing the joint session of Parliament on Thursday, President Droupadi Murmu said, "India is the third largest domestic aviation market in the world," adding that in April 2014 there were only 209 air routes, which rose to 605 in April 2024. .
“This increase in air routes has directly benefited Tier 2 and 3 cities,” she added.
