Soon after Air India announced an astonishing Rs 100 fare offer on Wednesday to celebrate Air India Day, the national carrier's website, where tickets were being sold exclusively, crashed.
Even though the airline claimed that it received "huge response" for the scheme, the potential customers who were trying to log on to the site to book tickets could not do so as the site continued to remain down till the evening. According to Air India, the scheme is valid for five days up to August 31 for travel during the period August 27 to September 30, 2014.
The state-run airline on Wednesday announced Rs 100 scheme on airfares (excluding taxes), for the first time to celebrate the Air India Day as the Indian Airlines and Air India were amalgamated into one airline on August 27, 2007.
According to a company executive, airline received a huge response on day one of the start of the sale. However, the site remained unavailable for most of the day, making it impossible for customers to book tickets.
The airline's website (www.airindia.com) is hosted by National Informatics Centre and the crash was a result of NIC server problem, according to the airline official. "The issue will be resolved shortly," said the official.
Experts are skeptical about any positive impact of this offer on Air India, given the airline's financial position. The airline has a debt of about Rs 44,000 crore, while losses stood at Rs 5,388 crore in FY14.
"For a carrier which is funded by taxpayers, such a move is almost suicidal. Also the airline is offering Rs 100 scheme for immediate travel, which is not really going to have a major impact," said an aviation expert, who refused to quoted.
With the entry of low cost carrier (LCC) AirAsia India, most airlines – including IndiGo, Jet Airways and SpiceJet have been offering competitive fares. A slew of discounts helped the budget carrier – SpiceJet race ahead of Jet Airways to the number two spot in July, in terms of number of passengers carried. However, Air India has been losing market share with more aggressive actions from the competition. Airline's market share came down to 18% in June from 19.8% in January this year, as per the data by DGCA.
According to Amber Dubey, partner and India head of aerospace and defense at global consultancy KPMG, flash sales of air tickets is a good tactic to stimulate buying, bring in non-flyers and sell seats which are anyways likely to remain unsold (eg. on non-peak hour flights). "Such tickets ideally should be for travel date at least 21-30 days away from the date of flash sale, since all airlines are then forced to follow suit. Many passengers buy tickets in a flash sale and then cancel tickets that they may have bought otherwise in advance, causing a loss to all airlines," he said.