If India Is Going Premium, Why Are its Airlines Fighting for the Budget Traveler?
India’s airlines have spent two years building premium cabins, airport lounges, and loyalty programs. But in the past two weeks, two of them launched products designed for the traveler who only care about the lowest fare.
On June 17, Air India unveiled a new Basic fare that strips complimentary meals from Economy tickets while retaining baggage. Then on July 1, IndiGo launched IndiGo Lite, removing the checked baggage allowance altogether in exchange for a slightly lower fare.
“Premiumization” has become the defining narrative of Indian consumer spending. Hotels are adding luxury inventory. Carmakers are selling more SUVs than small hatchbacks. Air India has been expanding Premium Economy across its domestic fleet following the Vistara merger. IndiGo has rolled out IndiGoStretch on busy routes, betting that more passengers will pay for extra legroom, hot meals and priority services.
Yet while both airlines are climbing the value ladder at the top,
