More customers but less profits, why Indian aviation faces a slump
- IndiaGlitz, [Monday,August 06 2018]
Travel by air in India has become very common with more and more people preferring comfort and luxury. However, despite the increase in the number of customers the industry is incurring heavy losses. One of the country’s largest services Jet Airways lost 7% of its stock value last Friday only.
Reportedly, the company doesn’t even have enough to make it through the next two months. However CEO Vinay Dube has refuted it saying media reports were false and malicious. Even though the company has plans to increase the spending on its services, with more airlines competing to give cheaper air travel it becomes a daunting task.
Decrease in the value of Indian currency and increasing oil prices might be the reason this happens. Dube has also pointed out the dilemma of rising fuel prices and still the same fares. Even Air India which failed to sell a 76% of it to shareholders recently, is spending hundreads of milllions into operating the company.