Wednesday, September 23, 2015

On a roller Costa!

The mortality rate of regional airlines in India is so high that every time a new one is launched, it is almost time to say goodbye.

But Vijayawada-based Air Costa, a part of construction conglomerate LEPL Group, has hung on gamely and is set to complete two years of operations in a couple of months.

Yes it has faced its own set of teething problems, gone wrong with the choice of aircraft, is stuck with expansion issues — it has only four planes — and is also burning money.

Air Costa has been bleeding between ₹3 crore and ₹4 crore every month. It may all sound dismal but according to the airline’s Chief Financial Officer Vivek Choudhary, Air Costa is confident of navigating through this turbulence.

“Any other airline would have inducted ATRs which are easy to maintain, burn less fuel and have easily available parts. But we went ahead and leased Embraers because we knew this was the right aircraft for the region even if it means a longer time for us to make money out of it,” Choudhary said.
23/09/15 Business Line
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