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The Year That Was: 2007
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The fastest-growing aviation market

December 5, 2007

2007 was one of the best years for Indian airlines. The largest deal in India's aviation history was witnessed in April, when after months of legal battles, Jet Airways finally acquired Air Sahara for Rs 1,450 crore (Rs 14.50 billion). Jet now operates Air Sahara as a separate airline under a new brand name, Jet Lite. Jet and Jet Lite have a combined domestic market share of about 29.4%.

In March, the government gave its final nod to the mega-merger of state-run carriers Air India and Indian. The merger turns the new entity into a large airline, with a combined fleet of about 120 aircraft and a staff strength of 30,000. Air India-Indian combine has a market share of 19.8%.

Vijay Mallya's Kingfisher Airlines bought a 26% stake in Deccan Aviation for Rs 550 crore (Rs 5.50 billion) in June, strengthening his presence in the space. After the Deccan buyout, the combine commands a market share of about 28.9%, inching close to Jet Airways.

Air Deccan, India's first budget airline, is now rebranded as 'SimpliFly Deccan.' Deccan will complete five years of domestic operations by the middle of next year and will be eligible for international operations. Kingfisher's rise in just two years is a now a big challenge for the 14-year-old Jet Airways.

Meanwhile, passenger traffic is booming. It registered a 36.47% growth to 317.29 lakh (3.172 million) passengers in the first three quarters of 2007. India is today the world's fastest-growing aviation market. Domestic passenger traffic is expected to double to 60 million by 2010 and reach 200 million by 2020.

Image: Vijay Mallya, Chairman, UB Group, embraces Air Deccan founder G R Gopinath in Mumbai, June 1. The UB Group's Kingfisher Airlines bought a 26% stake in India's first and largest no-frills carrier, Air Deccan. Photograph: Indranil Mukherjee/AFP/Getty Images
Also read: Jet vs Kingfisher: The battle for the No 1 slot
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