SpiceJet looking to order 20 planes as rates head south

Mumbai: In the midst of one of the most turbulent phases of the Indian aviation industry, which is expected to post a loss of $2 billion (Rs10,040 crore) in the fiscal ended 31 March, Gurgaon-based private carrier SpiceJet Ltd is looking to place orders for at least 20 planes. Delivery of these planes is projected to be around 2012, just in time for the firm’s expansion plans.
Under consideration is Boeing Co.’s 737-900 Extra Range, or ER, planes that can be used to fly as far as west and South-East Asia, according to a senior SpiceJet executive, who did not want to be identified. Airlines in India have to fly at least five years on domestic routes before they are eligible to fly overseas; SpiceJet fulfils that requirement in May 2010.
While the carrier’s current 19-strong fleet is all-Boeing, it is also in talks with European airplane maker Airbus SAS, another senior executive with the airline said. He, too, declined to be identified because the purchase talks are at a preliminary stage.
“We are speaking to various aircraft manufacturers for acquiring aircraft for future requirement. The idea is to get the best deal out of it. But the talks are in very premature stage and aircraft acquisition is not going to be imminent,” the first executive said. “The logic is that we will get slots for airplanes at much cheaper price compared to a year or two years ago. Secondly, we need to think about the capacity requirements beyond 2012. The scene is not going to continue like this and we may plan for international operations shortly.”
Using the existing fleet—Boeing 737-800 and 737-900ER planes—as a benchmark, 20 new planes would cost SpiceJet at least $1.5 billion (Rs7,530 crore). According to the Boeing website, these planes have a list price of between $76 million (Rs381.5 crore) and $87 million. (Rs436.7 crore)
There are no firm orders from SpiceJet or other carriers, Boeing’s India head said.
A spokesperson representing Airbus said there was no discussion with SpiceJet.
On Friday, SpiceJet’s chief executive officer Sanjay Aggarwal had said that the firm is beginning to think about aircraft orders beyond 2012. However, he said no decision has been taken about the number of the planes or details of aircraft acquisition.
08/04/09 P.R. Sanjai/Livemint

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Categories: SpiceJet Apr 2009