MIAMI – India’s dynamic airline industry sees four new airlines apply to the ministry of civil aviation for no-objection certificates (NOCs) to commence scheduled air passenger and cargo services.
One of these airlines is Akasa – backed by Indian billionaire Rakesh Jhunjhunwala, is making global headlines. The remaining three include Turbo Megha Airways (promoter of Hyderabad-based TruJet), Jet Freight Logistics, and SpiceXpress (the cargo arm of SpiceJet).
Akasa, which is to operate as an ultra-low-cost carrier (ULCC), is the most trending aviation talk in India. The carrier boasts billionaire backing and a highly experienced team of top management, which include the ex-CEO of Jet Airways (9W) Mr. Vinay Dube, and as part of the board Mr. Aditya Gosh – former president and CEO of Indigo (6E).
The airline has confirmed it will be based at Bengaluru International Airport (BLR) in south India, a major IT hub and one of the fastest-growing cities in Asia.
Akasa is keen on using the Boeing 737 MAX aircraft for its operations and reports state the airline could order at least 70 of the type in the coming days. Given the current situation in the Indian aviation industry, the right choice in selecting aircraft types is imperative.
India boasts an Airbus-dominated market of nearly 440 aircraft belonging to the A320 family while there are less than 90 Boeing 737 aircraft used by just two airlines, Spicejet (SG) and Air India Express (IX). Akasa could benefit from these two airlines drawing pilots and crew by providing better work conditions. India now also has its first 737 MAX simulator making training for non-type rated pilots a bit easier avoiding overseas travel.
Although Airbus holds a huge majority, orders for new aircraft have a long waiting list for a couple of years while Boeing could have several MAX jets ready and delivered at a lower cost well before which has already interested the airline’s promoter.
This is nothing short of a golden chance for Boeing to re-enter and compete in the Indian aviation market as it without a doubt is the fastest growing market with a bright future ahead once air travel overpowers rail and roadways.
ULCC Model in India
To pull off a ULCC model in India is not a matter of whether the airline can do it but whether the country actually has the necessary infrastructure and facilities to do so.
To begin with, Indian cities do not have regional and secondary airports and all airlines rely on the major hubs for which airline operating costs can’t be lowered. The Indian DGCA also requires all airlines to allow 15kg check-in baggage free of cost, another massive area where a ULCC would struggle.
The above are a few problems among many. Another crucial problem the airline would face is slot access. As mentioned, Indian cities have just one international airport and the crucial ones such as Mumbai (BOM) and Delhi (DEL) are full and operating at max capacity.
While expansions and new airports are still a work in progress, gaining slots will be a challenge for the time being as 9W seems to be part of the same race in order to re-start its operations.
Akasa expects to have all 70 aircraft within five years and could have a significant impact on the existing market conditions once it enters.
The country will see other new airlines make their way in the near future and most would opt for a low-cost model. With more low fare options out there, pricing will be extremely competitive and Indians will see a great increase in air travel and a move out of extremely long train journeys.
Featured image: ACA B38M at YVR | Boeing 737-8 MAX. Photo: Michal Mendyk/Airways