SpiceJet eyes 5-year growth plan

Mumbai: At a time when aviation industry is bleeding and in deep trouble, Gurgaon-based low cost carrier SpiceJet has formed a separate internal team for analysing the growth path for the next five years and different targets for the carrier.
The team, headed by CEO Sanjay Aggarwal, is mulling whether the carrier should go for Boeing or Airbus fleets for its requirement over the next five years. It is also analysing cost cutting measures, and deliberating on its international foray and buyout of a local carrier. It is also working on the fare structure over the next quarter.
Aggarwal said the airline is chalking out plans for the next five years in view of the current downturn. “The decision on fleet will take few months more as it’s a long process,” he said. Currently, SpiceJet operates 19 Boeing planes.
SpiceJet was said to raise fares when Kingfisher and Jet Airways hiked fares by Rs 300 per ticket a fortnight back, but a sudden and steep 70% cut in Air-India fares changed the complete plan. “Competition is important and we will have to act according to competition. It has forced us not to increase airfares in the last fortnight, though we have increase fares in few selective routes,” Aggarwal said.
Mark Martin, senior advisor, KPMG, told ET that domestic carriers should go back to the board room and draw fresh strategies to weather the upcoming turbulence in the aviation sector. If they don’t act now, then tough times are waiting for them.
04/05/09 Mithun Roy/Economic Times

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Categories: SpiceJet May 2009