How INDIGO AIRLINES became a MONOPOLY in Indian Aviation business | Monopoly series EP 3
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- Опубліковано 15 чер 2024
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Video Introduction: Did you know the India is known as the GRAVEYARD OF REGIONAL AIRLINES? We saw the fall of Giants like Jet Airways and Kingfisher right in front of our eyes! But surprisingly Indigo started as a small airline and became a MONOPOLY in the Indian aviation space with 10 consecutive years of PROFIT till 2018-19!
And even today, while Spice Jet's market share stands at 11.7%, Air India stands at 10.2%, GoAir stood 8.8%, IndiGo is wayyy ahead at 52.7% share which is more than next 5 competitors combined!! The question is HOW did INDIGO go from being a baby company to becoming a MONOPOLY in the Indian Aviation business??
To compare the financials of all the major airlines use Tickertape: ttape.in/jOcliWymYjb
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Study materials
www.hdfcsec.com/hsl.docs//Ind... Indigo Airlines HDFC research
The most amazing book I read
The Indigo Story: Inside the Upstart that Redefined Indian Aviation
www.amazon.in/dp/9353043557/r...
Tickertape Financials of Indigo ( Study and compare this with others using the screener)
www.tickertape.in/stocks/inte...
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Chapters
0:00 Intro
1:48 Understanding the numbers
3:05 3 Truths of the Indian aviation market
4:37 Indigo's cost-cutting strategies
5:53 How does the Sales and leaseback model work?
6:54 Advantages of Sales and leaseback model
7:50 Why did Kingfisher fail in spite of using the Sales and leaseback model?
9:00 Hub and spoke vs point to point model
11:19 How did Oil prices create a crisis?
13:32 Indigo's extraordinary performance record
#thinkschool #indigo #indigomonopoly #airlinebusiness #indianairlines
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Note
Use chapter markers to skip the parts that you already know from the previous videos. Had to revise them to cover the indigo case indepth.
Hope you are loving this Monopoly series ❤️
Bro if these businesses are making losses then why they are still in it? And if they are still in it then how they are managing to get money for their use?
Ans plz
Can you please make a video on Ray-Ban glasses, since they and their competitors have same exact product, still how they get people to buy it. Even Milton does the same.
In the investment buisness rearview mirror is always cleaner than the windscrean (interglobe aviation is incurring heavy losses currently)
The strategy is same as southwest airlines
Everyone is talking about indigo's success. But indigo is exploiting thier engineeres by giving under range salary putting them to more work. 8k for trainy technicians and around 20k for technicians with no rise ( on contract basis).
Engineere's those who are responsible for safty of aircraft are just ignored by this (private)company.
Indigo tries to stay in air max time. I was in portblair today. Air India was on the ground for 90 minutes and Indigo was on the ground for just 45 minutes. Their arrivals and departures are super efficient
That’s because the traffic they cater to is massive.
True... Making money at any cost... Even junking passengers will be nipped soon..
Well don't worry. Air India wi'll turn things around. 'a couple of months under TATA. ''u will be rest assured. ''they will turn the airlines around. ''also be assured. 'the inhuman airline that almost cost an underaged boy from boarding along with his parents '''shows Indigo is a Bus ''not an airline.millions of passengers welcome Air India and Jet Airways as this Marwadi chuth airline has the worst ground and In-flight crew u can ever get world wide. 'But since the last few, years due to NPA of Air India. Jet Airways etc.. This shtitty Bus service.. Became a monopoly and cared 2,hoots about passengers.. Since passengers had no alternative they had to bend to Indigo (can u imagine how airline is the master, and passenger the servant... That's the sum story of Indigo). 'Only their pilots flew aircrafts... But the rest was torture to fly with Indigo....... Now Indigo staff. Pilots etc.. Will be sucking up to Air India.. Jet Airways etc.. '
Yess sir... We get only 40 mints of ground time for a Turnaround flight...
If u r from aviation then u wud understand y indigo is ontime I can't type in on social media but to be honest it's all about authority nd festivals ,
Kingfisher was miles ahead of its time, I still remember walking on a red carpet with the hostess waiting at the gate and an in flight menu that could easily beat Emirates, and this I'm talking about an domestic flight. It truly kept India on the map and at par with global standards.
What it failed to understand was we Indians want dal at ₹1 and onions for free.
Does indigo provide dal in ₹1 and onion in free
@@user-sk2dl8sm5v I said we Indians
@@user-sk2dl8sm5v Well don't know about dal but I remember once I cancelled my AC 2 tier train ticket from Chennai to Kolkata and booked an Indigo and still got 200 rs remaining in my pocket. 😂
@@Vibevortex21 so ?
😂😂 jugadu boiisss
Mr. Aditya Ghosh is the man who made Indigo market leader.
Interesting thing is now he is the CEO of Akasa Airlines.
Indian Aviation market is gonna be super interesting now.
Vinay Dube is the CEO of akasa airlines .
You have put so much efforts in explaining this case study. Even in MBA classes , they don't explain so well. Thanks
Thank you so much ❤️
ua-cam.com/users/shortsQ7zpWy1RN3c?feature=share jjj
Is these types of thinks taught in mba?
@sujatadongree99 thats wht enthusiasts do
@@JEE-ff5pp me also wondering, what's her specializations to teach her about aviation
Now Waiting for Akasa Airlines :)
You mentioned about the oil price hike in 2008 but forgot how IndiGo struck this opportunity. They used derivatives to hedge their fuel prices for such an eventuality beforehand, burnt some cash by paying higher prices initially, but saved a lot of it when prices skyrocketed. There was a brilliant article on it I'm trying to find since 2 days but couldn't.
Also you could've done a short SWOT analysis mentioning UDAN scheme (O) and Akasa (T), but fantastic video as usual. 💯
While looking into this southwest airlines adopted different strategies than Indigo, yet both succeeded, interms of model of operation. That's very interesting and makes me to reaserch a lot. Thanks brother for sharing this all insight of business world.
Southwest airlines is identical to this model except the hub and spoke and that they use futures to hedge oil prices
Southwest is very much simar to indigo, however their network is extensive and their cost optimization is brilliant.
Does indigo operate at profits ? Their book value is too low
@@princeo15 prolly because as mentioned they dont have the planes as assets and they rent them.
hub and spoke is dead bro
We may have seen how IndiGo stayed profitable with their best business strategy, but the greatest turnaround story is on the card's with the Tata' taking over Air India. The chairman N. Chandra is a exceptional person who is going to get the turnaround done in few years down the lane.
And I loved the way they treat their customers … vistara Is what the future is
It’ll be interesting to see how Air India shapes up now after the takeover. It’s still India’s own trusted airlines. If they can nail the price game and facilities, they do have a chance at beating IndiGo.
If the Tata's can't turn around it, no one can do it. They said the same for Tata Steel, Tata motors but the two companies are totally into a growth trajectory. Their balance sheets are well repaired and is ready for a growth. They might feel the pressure in near term, but in the long term it will definitely be a world class Airline
I'm not telling about the stock price, fundamentally their growth for long term is good. Their business strategy for growth is promising.
Everyone is talking about indigo's success. But indigo is exploiting thier engineeres by giving under range salary putting them to more work. 8k for trainy technicians and around 20k for technicians with no rise ( on contract basis).
Engineere's those who are responsible for safty of aircraft are just ignored by this (private)company.
Why engineers are working for such low pay. They can very well resign and look for better opportunities? Its all about demand and supply. Majority of the public want to fly only if the prices are cheap, they are least bothered about other things ( safety etc). So company has to save money somewhere to make profits. Thus they get to hire ppl at less salaries. No one is forcing anyone to work in their company only. Its ones need to feed families. If they dont work, someone else will be ready to work with so many unemployed all around...
Indigo waste anti Indian
I went to UC Berkeley for an MBA. I remember covering this in class and this video explains these concepts far better than my millionaire professors
Working at indigo is amazing we have the lowest turn around time (30 min) other airlines take upto 45 minutes to turn around for next flight
They were the software provider for Deccan air in the name of inter globe technologies. You can read about this from simply fly book by captain Gopinath.
The aviation industry is again ready for a drastic change by Tata's acquiring Air India and Akasa's entry.
Who's the new airline I didn't even know who owns it
Rakesh jhunjhunwala
😀stock investor spotted
@@unboxingtech1598 stock promoter?
Apart from business I want to share my story why I personally prefer indigo over any other airlines I come from a middle class family so cost of something really matters to me as we are short of money whenever I first started to travel with indigo I always had the anxiety of Luaagge overweight as it makes me pay more but surprisingly whenever I carry 1 Luaagge and two or one school type bag i was never once made to pay more but one time i didn't get ticket of indigo while travelling to my hometown and had to choose spicejet but this time when I came to check in they not only measure my Luaagge and even made to measure my handbag as my hand bag was 1kg more they made me pay for it even on insisting to them I am a student so i am never in my life going to choose spicejet to travel unless and until I don't have any option left
You missed the main part in indigo's success.. They operated only A320s...so alll their training, operations are centered around only A320and they were able to bargain for better discount from AIRBUS by ordering the aircraft in large numbers at one go...Also even if indigo lose few employees, they have employees who has experience to handle A320s...unlike other operators who has mix of Airbus and Boeing requiring different skill set and that's why people per aircraft is low for indigo.
That was the success story of Southwest airlines USA.
They done it before
Those who follow this channel they know he already shared this indigo strategy. 🙂
Your case studies are simply amazing! Looking forward to you joining the top 10 most subscribed channels on UA-cam!! Keep up the good work!!!
This Monopoly series is getting better and better. 🔥
I was looking for the example of sale and lease back model as I had this topic last year but didn't understand anything but you explained it so well. Thank you dada.
Thank you. I always wanted to know how indigo dominated the market being a frequent flyer of indigo. Coz I never prefer other airlines.
I predict that Indigo is a, bogus airline and will be raided soon.. Once Air India gets its act together... Indigo is the worst.. Inhuman airline ever... Disgraceful to fly with them. ..'Ofcourse India did not have any choice for a couple of years. But to fly with the most disgraceful Indian owned airline... Thank God we have a, professional and dedicated Union Civil aviation Minister.. ''my prediction ..indigo which monopolized the market for years. ..should first be raided for all their activities.. '
I believe Indigo has taken best from all model. I don’t know how they are now as last I traveled in Indigo was more than 5 years back but their seats were very nice and comfortable, staffs were good as well.
Ryanair on the other hand is one of the shitiest airline, seats are no better than roadways bus in India, very rude staff throughout the Europe, charge you for everything else like bag, fast queue, even for seat selection.
They still have more than 20%market share in-spite of all that and are profitable. That goes on to say no matter where you are in India or Europe or America, people will prefer cheap (at least for short flights).
At least I have more respect for Indigo as they are still far better in customer service.
Indigo provides good, efficient , no nonsense service at reasonable costs, that's why they have succeeded... even I prefer indigo, I have flown in indigo twice in the last 30 days
Indigo has Ryanair seats now
Indigo is alright for middle class people.Some flights of indigo and the people were shitty and some were extremely good.It depends.zsame for every airlines.
Pure and raw content always expected from ur side, thanx for sharing this information to ur audience ☺
Amazing content. Loved the way you explained the point-to-point and hub & spoke model, we know about direct flights and hoping flights but had no idea about the technical term for it.
Wow... The Case Study is just incredible. Thank you for educating us on the Hub and Spoke Model. It is amazing 🙂
It is very refreshing to see such Indian case studies! Thank you!
In 2009-09 period when indigo made profits, why ddint other airlines study indigo model and shift to that? If we common people can do this much reserach, then I am sure professionals in airlines could reserach indigo much further. Yet, they didnt change. What is the reason behind it.
Please apart from tellling what a company did right and other did wrong, also if the video covers why other competition didnt follow this strategy, It would be very helpful
Cash crunch from the past moves + Co-founders of Indigo already had a remarkable reputation with American airlines to get Aircrafts from Airbus!
From your 50k subscriber to now approx 1 million one thing is same consistency and your enthusiasm when you describe any case study and lesson from it ❣️
Loved it... Thank you Ganesh sir... It was a great leaning..
Been Invested in indigo since March 2020 Lowder due to its low cost operator MOAT and I love this company..
Top-notch brother 💯
Hats off to your level of explaining.
It kept me to WATCH TILL END...
Nice case -study with brilliant slides with lots of things to learn.
Really insightful and appreciate the summarized takeaways... very helpful for business professionals.. keep up the good work..
I first click on Like button and then continue to watch...Rarely we get a quality content with mesmerizing presentation....Ganesh do his job very seriously and sincerely..... Oversimplified award goes to Think School..
Excellent study !!! amaze to see your appetite and focus on business in depth analysis !!!
Am astounded at the way that branding in Indigo works. Even the way cashew nuts is packed to distribute in flight in 'nutcase' with attractive colours, quality of coffee cups with indigo brand ( even the thought of a cover for coffee with a hole to sip preventing coffee spilling during turbulence).
Extraordinary content. It is such content that I look for, and ThinkSchool hits the target EVERYTIME. Hats off to the research and commitment to the quality of content. My favorite YT channel across various accounts on my laptop, phone, and tab.
There’s always something to learn from your videos. Keep up the great work. 👍🏾
Indigo's story is quite well known, but for the first time I was more fascinated by the sponsors, Thanks Ganesh for bringing this form of investment to our knowledge.
Love your channel guys, pretty straightforward and informative
"On time" motto and practice by Indigo is also a big factor why customers prefer this no nonsense/frills carrier.
And if I'm not wrong, another cost reduction factor is docking aircrafts away from the terminal and not splurging on prime spots.
Wow!! You're explanations are just amazing! ❤️ Didn't felt bored for even a single second! 🔥❤️
Awesome content Team Think School! You are the Wiki of Business strategies! 🧡
Sticking to the core objective of the business is the key ! whats more important is the way your present your data. kudos to you. keep it up !
What a perfect analogy...right punches at the right time makes your content remarkable
Indigo wanted to be proper point to point model, while Jet Airways was Hub and Spoke
This is a great analysis! Very well put together and informative
This video was really worth it. So many strategies explained!
Thanks for covering Grip Invest :)
I am waiting for Air India under Tata , extremely excited for the change and want to see Maharaj back on its feet.
I do travel a lot, but not with any Indian flights anymore, as most of the Indian flights try to pull your money out of your pockets and we as a customer loose it always because of their ignorance. So I made my mind to travel with flights like Emirates and Etihad. Because of this I have 1 free return ticket still waiting for me since 2020 with Emirates. They said to just call and tell us when you wish to travel with a date and that’s the service keep us delighted. Had some incidents with many Indian flights as they told me simply cancel that ticket and will issue new and they don’t even respond. So people like me don’t prefer any flights other than these 2. But will try AIR INDIA for sure as it’s with TATA, sure this company has a minimum guarantee of their services. Good luck Sir Ratan Tata!
Absolutely amazing video. Good work there lad. 🎉
Brilliant analysis, explaining such complex industry with complex work model in simple.terms,, commendable,, 👏👏👏
Awesome content man. You are the next business encyclopedia of our country
One very important point to be included for saving cost and having higher efficiency was having the same aircraft type in the fleet. It has only A320 family for single aisle turbofan (A320Ceo, 320Neo, 321N) and ATR for turboprop type.
Whereas most other airlines in India operated multiple aircraft type like Air India had 737 and also 319, 320 and 321 for short & medium haul range. Jet had A330 and 777 as their widebody long hauls, Kingfisher had Vistara has 737 and 320s in its fleet. The same manufacturer and aircraft type in fleet increases efficiency by optimization of maintenance and crew training cost, which plays a significant part of cost.
Heyyy Ganesh bhai, I would love to get a video on "Why Deccan Air failed to sustain in Indian Aviation Market"!!
I came back to see this video of indigo airlines after gaining some knowledge about airlines
One main reason that indigo suceed that they bough oil insurance so even oil was all time high they still have to pay low
Yes Oil Hedging
If you now do a case study on the youngest Airline Asaka, you will find a similar model and now it is the fastest growing airline in the world. By the year end they have grand plans to go International. Watch out for this Airline as Mr Ghosh is at the helm of affairs and with his foresightedness and business awareness he will take it to greater heights. With I Lean and Clean model in few years they will turn around the numbers.
Great content for any students and the general public to understand..........good going
I really loved the idea of Hub and spook...
Great video... 🔥👍
I flew indigo, they have are fantastic planes, feels light and comfortably spacious
Fabulous explanation of complex business of airline in most understandable terms and graphics. Plurals of aircraft and equipment are same words. Sometimes little faster to grasp.
More perhaps could be added how Indigo secures huge quantity discounts and favourable terms, while dealing in large no. aircraft with mfrs, lessors, MROs on long term basis. An old interview of A Ghosh in CNBC was very interesting to watch on same.
goosebumps video ...hey ganesh & team,if possible please make video on how u guys where running ur channel bcos i really want to know how u r managing ur expenses and expanding.It will be a eyeopener for many of us and will tell the todays youth about managing technology streamlines
Absolutely astounding...👌👌👌
Great video! You’ve also shared some of these things in Akasa Airlines video.❤️
Superb case study and I am addicted to your channel 🔥🔥
Excited to see competition between Akasa Air and IndiGo.
Just booked a flight on Indigo! Always loved it.
Would like to see a case study on building a succesful hospital business at reasonable cost and simultaneous profits....with all the limitations in indian settings
Thank you so much for this wonderful case study..
This was a MasterClass in business! Bravo
Again, a well put study. Well done.
Where did you get the content ?
It's such a quality content.
Oh that's why Indigo is dominating Indian market for many many years😄🤩
Great job IndiGo
This one is very informative. I always think about this. Why jet airways doomed when they were the leader of the market and indigo always survive. Thank you for making this one.. cheers!
Your style of explaining is simply awesome Bro...Fresh content, thorough analysis, appealing presentation.... DieHardFan of this Channel 💗
Extremely valuable channel.. thank you so much for sharing your valuable thoughts & knowledge bro.🙏
thank you soo much for this type of amazing content.....
just wow on such incredible cash flow management 🙌 by Indigo airlines...very nice vlog 👌 👍 Ganesh and think school team
Going to hit a million subscribers... very happy for this man 👏 following him from 5k subscribers . Great job ganesh bhai ...
Amazing explanation and casestudy!
Simply amazing….. what an insight!!!
Airhostess @ 14:17 was my classmate in school, her name is Gagandeep kaur.
Air craft maintenance and training costs were reduced bcoz unlike other carriers who have heterogeneous fleet , a nearly homogeneous fleet of A320s ensured recurring maintenance costs were lowered
I am in love with the outro music.❤️
All the best indigo
Our maharaja is back
Tough competition😊
I like the presentation u have given ...well done easily understandable
When I first heard lease back model in a Tech park I started working,I wasn't sure about that but now I know how brilliant the CEO was 🙄 Thanks brother 🙏
The leasing model was a revision of the Rakesh Jhunjhunwaala's airiline video
Thanks you so much for this great knowledge ❤️🙏
The current airline industry is very interesting as well with the introduction of akasha airlines and Air India taken up by Tata.
Very good video with a detailed analysis... time to buy some shares of indigo in a staggered manner.
I want you to keep speaking , u r such a delight when you talk.
Very nice and helpful information with the class of understanding subject
This was so insightful and amazing. Thank you so much sir.
One question though...I get Sales and Leaseback model but isn't it more safe to own your assets instead of continuously leasing it?
Won't BOC airline be in a position to make deal with some other airline and lease their airlines to them??
Very nicely explained 👍
Amazing case study, thank you so much
While boarding on to any domestic flight other than indigo,i have lower confidence ABT cabin cleanliness,time punctuality,safety,food quality and I don't know what to expect.... that speaks a lot ABT indigo being a low cost carrier,i feel consistency is key
Very true. I dread when I have to fly anything other budget carrier. Indigo aircrafts are always new and clean. The staff is very professional in the sense they represent the brand. Not seeing random advertisement in the aircraft which makes it look cheap on the other airlines.
There is also one more major factor that not many people know about how indigo succeeded in LCC. Indigo's promoter Rahul Bhatia owns the interglobe aviation ticketing software which has clear approvals from IATA. When Rahul Bhatia wanted to started indigo airlines, he knew that he can't compete with deccan air - headed by capt. Gopinath. However, since interglobe aviation was the ticketing partner for deccan air, and with the simultaneous use of the same software for indigo airlines, Rahul Bhatia made sure that the softwares misaligned for deccan air and eventually deccan started loosing its grip on the ticketing issues. This is factually elaborated in the book simply fly written by capt gopinath. Rahul Bhatia's industry expertise through ticketing made him the king of the Indian Aviation sector. Deccan had also used the same sale and lease back model and ordered huge aircrafts. Not many people accept this fact but this is the eventual truth. I waited till the end to see of the author of this video pointed this hidden fact. Unfortunately the failed lessons weren't learnt and portrayed in full picture.
PS- only very few innovations have been done by the company on its own. The majority of the business model is either stolen or replicated from deccan air, Ryan and southwest. Rahul Bhatia made it big with the fundamental ticketing software. His revenues still out compete from his ticketing software company over the airlines.
Hope this gives the entire picture to case study.
Thank you, very insightful ❤.
Lovely presentation with solid research
Another excellent episode. ❤️