Low-cost airlines led by IndiGo and SpiceJet seem to be building their brand loyalty among corporate travellers. The carriers have nearly doubled the share of corporate bookings to around 16% in the last two years with business houses learning the art of keeping their travel budget low in the face of slowdown in the second half of 2008. One of the reasons is that these low-cost airlines are slowly becoming network carriers, say analysts.
?If one adds up the contracted and non-contracted corporate sales its share would be in the range of 30-40% of the total sales revenue of the two low-cost airlines,? industry sources said. A SpiceJet executive said that the revenue from corporate and business travel contributed 13% to the airline?s total revenue in 2009-10 against just 5% the previous year.
With budget carriers adding frills like food and beverage onboard and booking flexibility for frequent travellers, the air travel has fast shifted to the low-cost. As per an estimate, 65% travellers out of about 40 million annually fly low-cost and low-fare airlines. SpiceJet claims to have nearly 1,000 corporate houses as their clients, executives of which regularly fly with them. Rival IndiGo also boasts of having corporate honchos like Azim Premji, NR Narayana Murthy and YC Deveshwar as passengers.
