SANGAM PRASAIN
KATHMANDU, MAR 28 -
Stiff price competition among major domestic airlines propelled the demand for air travel in 2010. The figure of domestic passengers’ movement in 2010 depicts the fact that airlines attracted customers by offering low fares.
Domestic air passenger movement saw a robust growth of 12.83 percent in 2010 compared to the previous year. According to the statistics released by Tribhuvan International Airport (TIA), domestic airlines carried 1,554,701 travellers in 2010, or 176,833 more than in 2009.
Meanwhile, domestic aircraft movement increased 4.83 percent in 2010 compared to 2009. There were 79,874 flights in 2010, up 3,683 from 2009. There are eight domestic airlines and five helicopter services currently operating from Kathmandu.
However, intensified price competition will set the alarm bells ringing for major domestic airlines with the oil price rising to a massive level in 2011.
Following the increase in fuel surcharge in February and December last year, domestic airlines had increased their fares last month citing heavy losses. Unexpectedly, airfare soared by over 16 percent which reflects
airlines’ concerns that their businesses in 2011 might not do well like in 2010.
“The year 2010 has been a good year for almost all the airlines; however, the number of passengers has dropped 30-35 percent in the last two-three months due to increased airfares,” said Rupesh Joshi, marketing manager of Buddha Air.
Airlines said that higher tourist arrivals and greater travel by NGOs and INGOs around the country had resulted in an increase in the number of passengers for Nepal’s domestic airlines in 2010.
Buddha Air carried 615,567 passengers in 2010, up 10.53 percent from 2009 while its aircraft movement dropped to 23,238 from 24,797 previously as it began operating larger aircraft, the ATR-72.
According to Joshi, 70 percent of the passengers on domestic airlines are Nepalis. Although, tourist arrivals have been swelling, carriers said their business depended on home passengers. “If the price of fuel continues to rise, the airline business will see a drastic fall.”
Yeti Airlines was the second largest domestic carrier with 478,225 passengers, a drop of 0.54 percent compared to 2009. The number of passengers flying Yeti’s subsidiary Tara Air soared 141 percent compared to 2009. Tara Air started operations in June 2009 and flies on short-haul routes. It carried 42,724 passengers in 2009.
Agni Air’s passenger movement rose 10.94 percent to 193,313 from 174,244 in the previous year. Guna Airlines, which started service in May 2009, carried 96,122 passengers in 2010, up 143 percent from 2009.
The poor performance of Nepal Airlines Corporation (NAC) is also visible in the domestic sector. The number of passengers carried by NAC in 2010 dipped 11.84 percent to 47,081 from 53,406 in the previous year.
The Civil Aviation Authority of Nepal said that domestic passenger movement was projected to grow 10 percent annually.
“TIA handles both domestic and international aircraft through its single runway, and limited airspace and increased air traffic have become a major concern,” said TIA general manager Ratish Chandra Lal Suman.
He added that CAAN was studying the possibility of giving priority to large aircraft at TIA and diversifying small aircraft to regional hubs to ease congestion at Nepal’s only international airport.
