Captain Gorur Ramaswamy Gopinath began his journey with a vision - a dream inspired by one simple statement: "I desire every Indian to fly at least once in their life." With a population in excess of 1 billion people, India definitely offered a vast reservoir of future air travelers. In 2002, when Capt. Gopinath first broached the idea of beginning a low-cost airline to serve India's journey needs, no one took him seriously. Bankers refused to finance him, he was discounted by aircraft manufacturers and aviation industry observers declared that India wasn't prepared. Yet, he was convinced that India's burgeoning middle class, already buying color TVs and cell phones, could be converted to air travel. In 2003 he launched the first low-cost airline company in India with a leased 48-seater ATR aircraft and $10 million from investors. By the year 2007, Capt. Gopinath was close to accomplishing his vision.
Air Deccan, with a market allocation of 21.6%, was India's fastest-growing low-cost carrier and the second-biggest airline in the country. It ran the most extensive network in India , covering 61 airports, flew some 306 scheduled flights a day and operated a brand new fleet of 14 Airbus A320 and 22 ATR Turboprops. Airy and consistently affirmative, Capt. Gopinath had brought about a complete revolution to the highly controlled Indian skies. But every revolution carries the seeds of its own demise. Rivalry was increasing fast now the model had been validated, and the Indian airport infrastructure was on the verge of a huge dislocation. New business models had to be devised to remain ahead of the curve. Learning objectives: Learn about new business models, innovations, growth management, low cost carrier strategies, Indian problems.
PUBLICATION DATE: July 01, 2008 PRODUCT #: IMD377-PDF-ENG
This is just an excerpt. This case is about INNOVATION & ENTREPRENEURSHIP
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