Monday, October 09, 2017

SpiceJet in talks with aircraft makers to cut long-haul travel cost: Ajay Singh

Ajay Singh, chairman and managing director of SpiceJet, the airline he started in 2005, sold five years later, re-took control of in 2015 and turned it around, now plans to fly over 100 amphibian planes in India to boost connectivity and tourism. In an interview with Shahkar Abidi on the sidelines of an event announcing the plan for amphibian planes, he spoke about how is the carrier is going to raise money for the amphibian planes, the plan to start long-haul low-cost services, fuel price, fares, among other things.

How did this plan to start amphibian plane service happen?
No, it is they (Japan's Setouchi Holdings) who came to us. Actually, I had used one of the planes in Dubai earlier this year. It was so interesting to see it land on a small body of water. It makes us think that in a country (India), which is so constrained in infrastructure and where there are so many small cities and towns which have nothing like an airport, can air connectivity be provided to the people here? The amphibian planes can do that. So here we are trying to do that.

But what about the commercial viability of the project?
In terms of commercial viability, this is exactly what we are doing now. We are studying how the cost can be brought down to a level where we can fly people at a reasonable fare and also make significant money. Obviously, SpiceJet is a commercial enterprise and would, therefore, get into it only if there is commercial viability in the project.

But many such projects in the past have failed in the country. One such example which immediately comes to mind is that of a company by the name of Mehair in Mumbai which had great difficulty in getting the permissions for the desired routes.
We met with the authorities and they have been extremely enthusiastic about the whole thing. We don’t see getting permissions would be a challenge because if these planes can fly in other parts of the world, then why not here? The same rules that apply to other parts of the world, in developed economies, can be applied in India. Sometimes, these kinds of projects fail in India because of the lack of scale. With around two to three planes, it becomes very expensive to get it (the aircraft), hire pilots and engineering services, etc.
09/10/17 Shahkar Abidi/DNA