Some limitations to the success of the Low-Cost Carrier business model in India

Abstract

Despite the growth in market share of Indian Low-Cost Carriers (LCCs), there are certain factors inhibiting the success of the LCC business model in India. This paper argues that the success of the LCC business model in India is limited by three exogenous factors – the lack of the concept of secondary airports, the route dispersal guidelines, and the excessively high costs of Aircraft Turbine Fuel (ATF). These factors are unique to India and a direct result of the flawed policies is adopted by the government. These policies also indicate the extent to which air transport in India is still regulated.