India is currently the ninth largest civil aviation markets in the world. It is projected to be the third largest aviation market by the year 2020. Using Michael Porter's five forces model to the industry, discuss: (i) T

Using Michael Porter's Five Forces Model, the threat of new entrants in the Indian civil aviation market can be discussed as follows: High Capital Investment: The aviation industry requires substantial investments at both entry and operating levels. This intensive capital outlay acts as a significant barrier to entry for new players, as only those with deep pockets or strong financial backing can consider entering. Regulatory Approvals and Licensing: The civil aviation sector is heavily regulated. Obtaining the necessary regulatory approvals and licenses from various authorities (e.g., DGCA, Ministry of Civil Aviation) is a complex, time-consuming, and stringent process, which acts as a major deterrent for potential new entrants. Advanced Operating Acumen and Skilled Labour: The industry demands highly skilled personnel, including pilots, aircraft maintenance engineers, technicians, and in-flight crew. Acquiring and training such a workforce involves a high learning curve and significant investment, making it difficult for new players to quickly establish operational expertise. Superior Technology and Continuous Upgrades: Aviation relies on cutting-edge technology, which is constantly evolving. New entrants must invest heavily in modern aircraft, navigation systems, and operational software. The need for continuous technological upgrades and innovations further raises the entry barrier. Long Break-Even Periods: The aviation industry typically has long break-even periods due to high fixed costs and intense competition. Only entrants with diversified revenue streams or substantial financial reserves can sustain operations until profitability is achieved. Vulnerability to External Factors (e.g., Oil Prices): The industry is highly susceptible to external shocks, particularly fluctuations in oil prices, which directly impact operating costs. Upward changes in oil prices can quickly undermine the financial viability of even established players, making investors and potential entrants cautious. Brand Loyalty and Network Effects: Established airlines often have strong brand recognition, customer loyalty programs, and extensive route networks, which are difficult for new entrants to replicate quickly. In summary, while the Indian aviation market is growing, the significant barriers related to capital, regulation, technology, human resources, and market dynamics make the threat of new entrants relatively low.