Tuesday, May 23, 2017

In current shape, Air India purchase not viable: SpiceJet's Ajay Singh

After bringing SpiceJet back from the precipice, the budget carrier's chairman Ajay Singh is looking to expand its wings further. He spoke to TOI on his plans for long-haul budget flights,airport infrastructure crunch and also if a move to privatise Air India in its current form will get any takers.

How do you view the decision on GST?
We welcome the government's decision to reduce tax on economy class seats from 6% to 5%. This move will help boost air travel and is in line with the government's aim to make flying more affordable for the masses.
Will Air India be a good buy for anyone if the government puts it on the block?
AI is the national carrier and has immense value. But it has amassive mountain of debt, as the airline chairman (Ashwani Lohani) also says. The debt (almost Rs 50,000 crore) makes it completely unviable. There is a massive working capital debt, which is very difficult to repay. In its current form, it does not appear to be a viable proposition.
If the government takes on a large part of the debt?
That is hypothetical. One will have to look at finally what is on offer. There is no doubt AI is a big brand and has great assets as well.
What are your plans for budget long-haul flights?
It is worth a shot. India is the fastest growing aviation market in the world. Why should we send our flyers out on foreign carriers which take our traffic to their hubs and fly them to rest of the world from there? What works in India is low-cost, and offer lowest possible fares and still make money. This is a model we need to explore for long-haul too.
23/05/17 Sidhartha & Saurabh Sinha/Times of India