Vistara launches Vistara Lite: low fares with no meals

India has been a Value-chasing market in terms of airfares for as long as I can remember. Low airfares have fuelled a massive shift from train travel to air travel, but those same folks move back to trains the minute airlines try and raise fares. The choices usually are to fly empty planes or get closer to the cost of operating flights (and turning a profit).

Airlines have tried various things in the past and have lived to tell the tale. Air Deccan became Kingfisher Red with one class of service when Kingfisher acquired it. Jet Airways converted Air Sahara to JetLite when they wanted to offer a low-cost alternative. They also launched JetKonnect, which was Jet Airways planes and crew but no hospitality on board. Eventually, it did not work for them, so they killed it and went back to being full-service carriers. But their most successful attempt at straddling the market spectrum has been Fare Choices, where they offer a slightly different treatment basis the class of fare you are booked on the same plane. So, for instance, if I bought a Light ticket or a Deal Fare, no lounge access, even as a JetPrivilege Platinum. And that is fine.

Vistara has now joined the party. The business case for Vistara had started from two business houses of repute coming together to bring back the romance of flying in the Indian skies. And over the years they earned a reputation for being the finest carrier in India. It’s almost become a thing to show off your nice Vistara meal on Twitter. Also, the first time anyone launched Premium Economy in India.

But that does not mean Vistara hasn’t taken hard decisions. Vistara vastly overestimated premium capacity when they launched. And they course corrected, cutting Business Class to half the size within a year of launch.

Vistara Lite Goes on Sale tomorrow

It now seems one more of those hard decisions has come their way. Vistara has announced that they would unbundle fares with effect from tomorrow, and offer a new class of tickets called Vistara Lite.

As per Vistara’s announcement, they will now have nine slabs of fares across the plane. Economy Class fares are called Lite, Standard and Flexi, while those for Premium Economy and Business Class are named Value, Standard and Flexi. They already have unbundled fares, only on their website, sold as Super Saver, Saver, Flexi for Economy Class so that nomenclature would change, but also the privileges that come along.

First the important one. Vistara LiteVistara states that this is a new category of fares for economy class customers only, who are looking at lowest fare classes and will come with multiple restrictions. None of the excellent Vistara food for these chaps unless they decide to buy-on-board. These flights won’t help earn tier points for Club Vistara, nor would be upgradeable or changeable. These guests get the standard 15 kg baggage allowance, but, in a leaf borrowed from Jet Airways recent move, only one bag allowed. Vistara Lite will be available for sale tomorrow (August 2, 2018) and available for flights operating August 29, 2018, onwards.

The next significant difference, very minor to the naked eye. Value Fares, available in Premium Economy and Business Class are not going to be upgradeable anymore. This is a departure from the current policy where any fare could be upgraded using Vistara points (confirmable in advance) or Vistara Vouchers (Space Available basis).

Standard Fares, which will be the next category for all fare classes will offer additional baggage allowance and flexibility for change and cancellation. Flexi Fares, those which allow for nil change and cancellation charges would come right on top.

Here is a summary of all the fare classes and what they come with.

Vistara Lite Fares

Of course, I have no data points on how these fare classes look like right now, so do expect more details over the coming days. There are aspects I like and aspects I don’t like about this. Elements I love are clearly about the part where it gives you a choice. You’d want to fly from Terminal 2 at Mumbai instead of Terminal 1, but don’t fuss over food? Vistara to Delhi. But, on the other hand, your neighbour got food included in their ticket, and you had to pay for it? Could be a heartburn.

But I’m sure this did not come out of a hat, and Vistara did a detailed analysis before rolling this out rather than just do it on a whim. The Board would have known too.

But what about Vistara Elites?

What’s very interesting is the elite treatment. On the one hand, Vistara has gone to lengths to assure elites that they’d get their soft benefits even on these tickets. That includes Priority Boarding, Additional Baggage Allowance and Lounge Access. They couldn’t have after all not added lounge access for elites, given when Jet Airways killed lounge access for people buying Deal fares; they went to town saying they offered all their elites Lounge Access. But, on the direct opposite, they are not allowing elites to stay elites by flying these fares, which is driving me nuts.

Lounge Access is a cost, so I’d be more than happy if they took that away but let the elites keep the ability to earn elite qualification points on these flights. Tier points are a hygiene factor/sticky factor for any airline loyalty program, and in this scenario, should be more important over the lounge in my book to keep their elites engaged and ask them to come back.

Of course, I need more data to make more comments. Right now I am left with so many questions:

  • Buy on Board is the same hot meal or something else?
  • Why pay external contractors for lounges and not instead add a hot-meal for elites on the plane?
  • 15 kg baggage allowance when not implemented uniformly, how does it help the airline?

And I will have more to say, but right now  I’ll say the same thing here which I said two years ago, but in the context of Vistara:

These changes allow Jet Airways Vistara to participate in the market where no-frill airlines dictate headline pricing and pull people into the Jet Airways  Vistara fold while they may only be looking at an Indigo or SpiceJet earlier due to the low fares.

Oh, and one more thing, now that more than one airline sells fare choices, I think Indians would be more careful going forward to choose the class of service they want to buy, because a little more could mean a lot more in terms of benefits, and I hope they want the benefits, and not just the cheapest fare.

What do you think about the upcoming changes to Vistara’s fare classes from tomorrow? Are you affected? I’m still gathering all my thoughts on this, so expect more from me on this in the coming days!

Comments

  1. Well i think this is ultimately a trial before deciding on whether to move to a full BOB model in their economy cabins. On paper its smart- they can differentitate their premium economy proposition something they have struggled with till date and effectively compete with LCC carriers- being a new carrier they dont have legacy costs. The issue i see however is that i think they are making their service offering too complicated for a young market like india. Hybrid models like JetBlue have typically worked in mature markets and from a cost perspective having three varied service propositions (Bob in economy, true full service in PE and luxury in biz) in a relatively lightly configured a320 may not give them the economies of scale to justify the complexity.

  2. I still feel this is slightly better in terms of accrual of miles where the most cheapest fare also earns 100%. It is not the case for north american carriers however. I suspect there will be further changes when long haul international is launched.

  3. I was in a fix, trying to decide whether i should keep my Vistara Plat status or head for Jet Plat and this has certainly helped me make my mind to shift to Jet!

    Like you rightly mentioned More than anything what hurts is that FF wont be able to earn tier points on these airfares!

    Vistara, may gain in terms of no. Of pax of will definately lose out on FF.

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