The 8-9 per cent jump on Friday in the stocks of SpiceJet and Jet Airways suggests that the Draft National Civil Aviation Policy 2015 has many positives for the sector in general, and for the entrenched, incumbent players in particular.
For one, the vintage players in the sector — Jet Airways, SpiceJet, IndiGo and Air India — must be relieved that the government has not yet revealed its hand on the contentious ‘5/20’ rule. Inviting suggestions and effectively kicking the can down the road, the draft policy suggests that the rule could continue, or be abolished, or be replaced, with domestic flying credits.
The older airlines want continuation of this rule that mandates five years of domestic operations and a fleet of 20 aircraft before an airline can start international operations. This is being opposed tooth and nail by new entrants such as AirAsia India and Vistara that want to fly international, without fetters, as soon as possible.
For the time being though, the older airlines will not see threat from the competition on their lucrative international routes.
30/10/15 Anand Kalyanaraman/Business Line
To Read the News in full at Source, Click the Headline
For one, the vintage players in the sector — Jet Airways, SpiceJet, IndiGo and Air India — must be relieved that the government has not yet revealed its hand on the contentious ‘5/20’ rule. Inviting suggestions and effectively kicking the can down the road, the draft policy suggests that the rule could continue, or be abolished, or be replaced, with domestic flying credits.
The older airlines want continuation of this rule that mandates five years of domestic operations and a fleet of 20 aircraft before an airline can start international operations. This is being opposed tooth and nail by new entrants such as AirAsia India and Vistara that want to fly international, without fetters, as soon as possible.
For the time being though, the older airlines will not see threat from the competition on their lucrative international routes.
30/10/15 Anand Kalyanaraman/Business Line
