Smaller aircraft to ferry SpiceJet’s regional push

India’s second largest low-fare carrier SpiceJet Ltd is equipping itself to fly to about 100 domestic destinations as it expands regional coverage even as it tries to remain profitable.
SpiceJet, controlled by media baron Kalanithi Maran of Sun TV Network Ltd, is altering its business model with the induction of fifteen 78-seater Bombardier Q400 turboprop aircraft in the 13-month period starting June.
The carrier’s fleet currently comprises 25 Boeing Co. 737 aircraft that have about 200 seats each. While using two aircraft types will push up engineering and training costs, analysts say SpiceJet may be onto something. They expect SpiceJet’s regional operations to be profitable, with each Q400 generating annual revenue of Rs.31.64 crore in the next fiscal year.
Metro routes—connecting Delhi, Mumbai, Chennai, Hyderabad, Bangalore and Kolkata—account for 25% of the airline passenger traffic within India, the ninth largest civil aviation market in the world. However, the country’s three full-service carriers—Jet Airways (India) Ltd, Kingfisher Airlines Ltd and Air India Ltd —are increasingly focusing on smaller cities. That’s because of the untapped potential of regional destinations and as the metro routes are crowded with flights.
25/02/11 P.R. Sanjai/Live Mint

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Categories: spicejet Feb 2011