Jet Airways and JetLite, combined, retained their first spot in market share among domestic airlines with 26.3 per cent in August, according to the Directorate General of Civil Aviation (DGCA) data. GoAir and SpiceJet had the lowest loads of 65 per cent.

Following the successful business model of low-cost carrier SpiceJet, which is aggressively expanding into Tier-II and Tier-III cities, private carrier Jet Airways on Tuesday said it plans similar services to smaller towns, which it had neglected so far. This is also a desperate attempt by the airline to fly out of its losses. It had reported a net loss of Rs 123.16 crore in Q1 of 2011 against a net profit of Rs 3.52 crore in Q1 of 2010.

The burgeoning middle class is increasingly opting for air travel over rail, while growing demand is also being seen in smaller cities, driven by growing regional expansion, forcing airlines to touch these sectors, which have so far been neglected but are potential markets.

In August, domestic airlines flew 4.7 million passengers. In July, the number was five million. While Jet carried 26 per cent passengers in August, Kingfisher and IndiGo came neck-to-neck for the second slot with 18.8 per cent and 18.7 per cent market share, respectively. Air India came fourth with 17.4 per cent share.

Low-cost carriers GoAir and SpiceJet had occupancy of 65 per cent and 66 per cent, which were the lowest. "August witnessed significant decrease in seat factor primarily due to the end of peak season and active monsoon in several parts of India,'' DGCA said in its analysis.

According to aviation industry sources, GoAir's loads dropped much more in comparison to other carriers. GoAir had recorded loads of 87 per cent in May. "GoAir has reduced the commission and incentives it was offering to its agents and online portals. The airline sells over 50 per cent seats through online portals,'' source said.