Wednesday, November 18, 2009

The tin can

There's a story in the papers about how the number of airline passengers has increased in the tier 2 towns of India. The article goes on to describe that the number of flyers from metros has not increased as much as the number of flyers from smaller cities and towns like Patna and Bhopal . This is a good thing, actually. Airplane travel is still perceived by many as being aspirational more than anything else. Although I truly wonder what the aspiration actually is, given that (quoting Shashi Tharoor) - most of us still travel cattle class, packed like sardines on tiny air crafts. I now understand the motivation behind the depressed look a perennially-traveling colleague of mine would bear at the very mention of the word 'travel'. 'I hate the TIN CAN', he'd say. The woes of low cost air travel still continue - with delays, slow baggage handling, not very efficient in-flight crews, painful seats, the works!!

But still, news that tier 2 towns are slowly achieving their self-set goals of graduating to air travel is good news! We can view this as being a manifestation of probable all-inclusive growth. It is a good thing that tier 2 towns are being developed enough economically - through entrepreneurial motivations of some, or even through Governmental enterprises. It most definitely is a breather for most cities since most of India's metros are packed to capacity and literally bursting at their seams. So the economic growth of the satellite towns is a step in the right direction towards eliminating migration as the only possible means of self-development.

Another interpretation is to look at the model of the low cost carriers themselves. The oft-beaten-to-death-at-B-schools story of Southwest Airlines shows that the low cost carrier used operational efficiency and 'organizational culture' to position the airline as competition to road travel. In other words, air travel through Southwest was not as much a sign of having 'arrived', as it was a sign that people were finally realizing the opportunity cost of their time! So, I would perhaps say that the augmentation in air travel from the tier 2 towns is testimony to the fact that given the length and breadth of India, people perhaps are able to realize the true value of their time. Granted income levels may have grown, but strong competition in the sector has made all airlines offer services at affordable prices. So, while all-inclusive development is one part of the explanation, I feel that there has been a certain level of rise in the economic status of the normal Indian consumer, who now feels that the price she pays for that airline ticket is worth at least the opportunity cost of her time.

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