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Jet Airways crisis: IndiGo, SpiceJet, Vistara, GoAir squabble over airline's international slots

As per the formula worked out, the grounded airline's foreign flying rights would be allotted to airlines ranked in terms of available seat kilometres, after giving Air India first claim. Domestic carriers reportedly allege that this gives market leader IndiGo an unfair edge.

twitter-logo BusinessToday.In        Last Updated: May 20, 2019  | 13:23 IST
Jet Airways crisis: IndiGo, SpiceJet, Vistara, GoAir squabble over airline's international slots
Rival airlines allege the government's allocation of Jet's slots will give IndiGo a monopoly advantage

Most of the domestic carriers eyeing a share of Jet Airways' foreign flying rights are unhappy with the allocation formula worked out by the government, reportedly claiming that it gives an unfair edge to market leader IndiGo. On Friday, Civil Aviation Secretary PS Kharola had said that the ministry would be creating a transparent standard operating procedure (SOP) to allocate the grounded airline's slots to other domestic players on a temporary basis. The move was an attempt to stabilise airfares that had risen dramatically on many international routes after Jet Airways suspended its operations on April 17.

As per the formula worked out, flying rights are to be apportioned in accordance with the Aeronautical Information Circular or AIC, which gives Air India first claim on the entitlements, The Economic Times reported. After the state carrier, foreign flying rights would be allotted to airlines ranked in order of domestic flights measured in ASKs, or available seat kilometres.

This means that after giving Air India first priority, IndiGo would get the lion's share of the remaining entitlements since it's the largest airline in the domestic sector. Government sources told the daily that this has led to a schism in the airline industry, with IndiGo on one side and its rivals on the other. They added that SpiceJet, Vistara and GoAir objected to the allocation formula at a meeting convened by Kharola on the grounds that this would create a "monopoly".

However, opinion on a more equitable division of Jet Airways' slots is divided. Some feel that the quota ought to be evenly awarded to domestic airlines, including those that have recently announced the launch of international services. Others suggest that since the allocations are temporary and the idea is to minimise inconvenience to the travelling public, Jet Airways' flying rights should only be allocated to the airlines that already operate on those routes.

The government's decision to give priority to Air India is reportedly also being questioned. The buzz is that Air India stands to bag about half of Jet Airways' slots on high-demand routes, apart from first right of refusal. The Maharajah will get about 5,700 weekly seats on the India-Dubai route, over 5,000 on the India-Qatar route and about 4,600 additional seats to and from London.

Meanwhile, AirAsia, which took delivery of its 20th aircraft in December, making it eligible to launch international operations, has protested the aviation ministry's decision to exclude it from meetings on dividing up Jet Airways' foreign flying rights. An aviation ministry official told the daily that "the opposition by airlines to the AIC is being discussed". Clarity on the topic may emerge over the next few days.

Also read: Clarity on Jet Airways to emerge within a week, says SBI chairman Rajnish Kumar

Also read: Promoters' spat could lead to IndiGo's fall

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