Saturday, January 06, 2018

Tata airlines Vistara and AirAsia India gear up for international runways

New Delhi: Around two years after the government made it easier for airlines to fly abroad, two Tata group airlines are preparing to start international operations. While Vistara, Tata group’s full-service carrier, will begin international flights in the second half of this year, its low-cost airline AirAsia India is likely to follow by the end of 2018.

According to the initial plans, both the airlines will try to take advantage of the strong markets of its parents Singapore Airlines and AirAsia Bhd. So, Vistara, a joint venture between the Tatas and Singapore Airlines, will initially start with Singapore and destinations in West Asia, while AirAsia India will feed into hubs such as Kuala Lumpur, where its parent Air Asia Bhd has a strong presence.

The government had relaxed the 5/20 rule, which mandated five years of domestic operations and 20 aircraft for an airline to fly abroad. While the condition of 20 aircraft stayed, the requirement of five years of domestic operations was waived. While it was heavily opposed by incumbents such as IndiGo, SpiceJet, and Jet Airways, Ratan Tata gave a public statement asking for the change.

According to Leslie Thng, chief executive officer (CEO), Vistara, the airline will initially start operations to the short-haul international destinations from Delhi and then scale up to middle-haul destinations within a nine-hour range. After consolidating its market, the airline will plan ultra long-haul destinations like the west coast of the US.

AirAsia India will try to feed into the extensive international network of AirAsia group, beginning with daily services to Kuala Lumpur and Bangkok from Bengaluru and Kolkata. Some of the routes that the airline has sought permission for are Bengaluru-Kuala Lumpur, Kolkata-Dhaka, Hyderabad-Kuala Lumpur.

“We are looking at end of 2018 or definitely by early 2019. Our group airlines have a meaningful presence in those two cities (Kuala Lumpur and Bangkok), all we need to do is to go and land there,” Amar Abrol, CEO of AirAsia India, said. The airline, which currently has 14 aircraft, plans to add at least eight annually for the next five years.
06/01/18 Arindam Majumder/Business Standard