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Wednesday, 16 August 2017

Indian Railway VS Low Cost Airlines

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It was reported recently that a blueprint prepared by Indian Railways (IR) had forewarned that the number of passengers travelling by air would exceed AC-class passengers in 2019-20. IR and domestic airlines carried about 145 million and 97.8 million passengers respectively between December 2015 and November 2016. With a projected 20% growth in air passengers and 5% growth in rail AC-class passengers between December 2015-November 2016 and 2019-20, it is estimated that air passengers will outnumber rail AC-class passengers in 2019-20.
The blueprint suggested that IR requires clear-cut strategies on capacity augmentation and pricing. Although IR has been augmenting its track capacity at a rate of 7km per day since 2015, it cannot be augmented to a level that can stop the airline juggernaut trampling the rail AC passenger segment by 2019-20. Hence IR can hardly do anything till 2020, when both dedicated freight corridors are commissioned, relieving sizeable capacity for IR.+
However, the topmost air origin-destination pair of Mumbai-Delhi, which alone carried 6.73 million passengers in 2016-17—almost four times the rail passengers of all classes on that route. It may be presumed that at least half of them, that is about 9,200 passengers per day, pay up to three times the 1AC/2AC train fare. By properly positioning conventional rail services, IR could capture one-third to two-thirds of these passengers from airlines.
The end-to-end travel time by air between Mumbai and Delhi may be about 6 hours, with 2 hours, 30 minutes at the departure end, 2 hours, 15 minutes of air travel and 1 hour, 15 minutes at the arrival end. The fastest train, Rajdhani, between Mumbai and Delhi takes about 15 hours, 35 minutes, with an average speed of 89 kmph, to travel 1,386km, and the end-to-end travel time is about 18 hours.
The entire route connecting Delhi and Mumbai is at least double electric line under the “A” category where trains can run up to a maximum speed of 160 kmph/130 kmph. If the average speed of trains is increased to 110 kmph, which is about 80% of the maximum speed, the train travel time would reduce by 3 hours and the end-to-end travel time could be reduced to 15 hours. If the departure and arrival times of these trains are fitted within the window of 6pm and 9am, which does not eat into productive hours of the day, it could be a game changer for IR.
Bengaluru-Mumbai is another top origin-destination pair where IR could give low-cost air carriers a run for their money. Airlines carried 3.37 million passengers in both directions of the route in 2016-17. Udyan Express, which connects Bengaluru City Junction with Mumbai CST, takes 23 hours, 5 minutes (a day and night) to cover 1,152km at an average speed of 50 kmph. Other trains also run almost at the same speed. About 90% of the route has double lines and considering this, the average speed of trains may be increased to 85 kmph; thus IR could reduce the travel time by about 10 hours, so that end-to-end travel between Bengaluru and Mumbai may be well within the time window of 6pm and 9am.
These two origin-destination pairs are just illustrations to show how IR will have to tweak its operations to give tough competition to low-cost airlines.
Courtesy : Livemint

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