KOCHI: Indicating a shift in the market share of airlines operating between South India and Far East countries, the Kochi-headquartered Air India Express (AIE) has decided to terminate its Chennai-Kuala Lumpur-Chennai service and explore under-utilised routes.
Earlier, the airline had cancelled its Chennai-Colombo-Chennai service due to operating loss. The Chennai-Kuala Lumpur-Chennai service will be withdrawn effective February 15, when a new service will be launched in the Delhi-Dhaka-Delhi route.
According to sources close to AIE, all the services of the airline, except the Chennai-Kuala Lumpur-Chennai service, are profitable. The main cause of the operating loss in the route is the low fares.
“Currently, it is very difficult to conduct service profitably to the Far East, due to stiff competition. It is wise to explore the under-utilised routes, considering the growing popularity of Air India Express in the North Indian market,” said an officer. The company has also decided to drop its route expansion plan - to Tehran - in the wake of the US revising its Iran policy. Air India Express deputy chief of customer relations Aby George said the decision was expected as the company had been monitoring market developments including the performance of its flights.
According to the company, the Dhaka market has not been tapped by budget airlines. The company is focusing on the Dhaka market as it can connect Dhaka with Middle East with a brief stopover in Delhi. After terminating the Chennai-Kuala Lumpur-Chennai service, the frequency of Calicut-Riyadh service will be increased.