A strategic analysis of Air Asia's entry into India

Abstract

Air travel is one of the booming industries in the market. Airline is central in today’s world as it as it enables economic growth and tourism. The Indian Airline was setup under the Air Corporations Act in 1953 with an initial capital of Rs. 32 million and started operations on 1st August, 1953. It was established after legislation to nationalize the entire airline industry was passed. Over the years many new airlines cropped up. Air India was formed after merging of eight domestic airlines which existed before independence. As the years progressed, several low-cost airlines in India such as SpiceJet, Indigo and Kingfisher airlines entered the market giving competition to the major airlines which operated earlier. In India, the development of new low-cost carriers is turning out to be a significant factor in evolution of the airline industry as a whole. With the entry of Air Asia and the proposed entry of TATA-Singapore airlines in the near future, the competition is set to increase all the more.