GoAir airlines is a budget carrier of India, which operates on the low cost model of operation. Launched by the famous Wadia Group in 2005, a business conglomerate with diversified interests, its objective was to offer cheap air tickets to passengers comparable to premium train tickets. Thus, the low cost model of operation was chosen. This model was pioneered by the American Southwest Airlines way back in 1970s to offer cheapest possible air tickets to passengers by cutting down massively on the in-flight amenities, which were considered as frills attached to flying. This model was also adopted successfully by many other airline companies of the world turning them profitable. It has been used by different airlines with some variations, depending on their business strategy. Here is how Go Air uses this mode of operation.
At first, the budget carrier operates a single aircraft type, A320-200. It has not used more than one type of aircraft, which considerably saves costs of maintenance. Different airplanes require different technical experts and components for their upkeep, which increases costs. Another benefit of using single airplane is that owners can place bulk orders and negotiate the prices to get a great deal that further reduce the financing costs. Furthermore, A320s are one of the most economic airplanes capable of operating highly efficiently.
Second, these operate on short-haul distances that can be covered in 3-4 hours. This enables them to cut down on many amenities which have to be offered to passengers on flights of greater duration. Thus, there are no free meals or entertainment provisions on these aircraft. There are restrictions on carrying oily, messy or smelly food inside the cabin to minimise spoilage, which further cuts down on time and costs involved in catering and maintenance.
Third, there is only economy class of cabin that makes pricing of air tickets low and allows better utilisation of capacities. Since the focus is on providing lowest airfares, having only economy class allows carriage of optimal number of people.
Fourth, GoAir Airlines does not offer a frequent flyer program. With minimal prices of tickets, airlines generally do not find it feasible to offer a loyalty rewards program. This is followed by most of the carriers providing services on this model but there are exceptions to this rule.
Fifth, there is focus on operational efficiency without compromising on the safety aspects in any way. Also, the carrier allows only minimum baggage as stipulated by the Director General of Civil Aviation rules.
Sixth, there are charges for using the ancillary services, having meals on board or carrying more than the stipulated baggage allowances. These enable the airline to garner more revenues while permitting passengers to pay only when they opt for it without clubbing these in lowest airfare tickets.
GoAir currently flies to about 22 destinations within India and plans to take this model to close-by international destinations in near future. This will give a chance to visit important tourist and business destinations in the neighbourhood at economical costs.
