blue skies ahead?
Friday, February 25, 2005
Q&A: GR Gopinath (Deccan Airways)
Key quotes:
"... both Delhi and Mumbai airports are choked — you cannot get parking slots, terminal gates and landing slots on the runaway. For instance, in Delhi and Mumbai only 25 aircraft can land every hour — that is half the average of any other international airport."
"... the archaic DGCA rules made in 1937, which were made when jets did not exist, need to be changed. The rules add to our cost. For instance, if a Boeing pilot wants to shift to an Airbus, and even if he is experienced, the rules state he still needs to log in 100 hours on an Airbus before flying the aircraft."
"... We also request the government to allow hedging in ATF fuel so that we are protected to some extent on the volatility of the fuel cost."
"I don’t think there will be any problem in selling 1 billion seats in a year — today we are at 16 million. Even today, China has 60 million airline customers. We might need 50,000 flights to achieve the objective. All you need is that the middle-class take a flight three to four times a year and you will reach the magic number. The constraint is not the passengers or the market; it’s the number of aircraft and the infrastructure in the country that is needed to support it. I think you will see the same revolution that hit the telecom sector. Five years ago you could not have imagined your driver with a mobile. Some years later, even he will travel by air."
- posted by katongking @ 9:54 am 0 comments
Key quotes:
"... both Delhi and Mumbai airports are choked — you cannot get parking slots, terminal gates and landing slots on the runaway. For instance, in Delhi and Mumbai only 25 aircraft can land every hour — that is half the average of any other international airport."
"... the archaic DGCA rules made in 1937, which were made when jets did not exist, need to be changed. The rules add to our cost. For instance, if a Boeing pilot wants to shift to an Airbus, and even if he is experienced, the rules state he still needs to log in 100 hours on an Airbus before flying the aircraft."
"... We also request the government to allow hedging in ATF fuel so that we are protected to some extent on the volatility of the fuel cost."
"I don’t think there will be any problem in selling 1 billion seats in a year — today we are at 16 million. Even today, China has 60 million airline customers. We might need 50,000 flights to achieve the objective. All you need is that the middle-class take a flight three to four times a year and you will reach the magic number. The constraint is not the passengers or the market; it’s the number of aircraft and the infrastructure in the country that is needed to support it. I think you will see the same revolution that hit the telecom sector. Five years ago you could not have imagined your driver with a mobile. Some years later, even he will travel by air."
- posted by katongking @ 9:54 am 0 comments
Fraport Wants Stake in Indian Airport
The aviation industry is regarded as an engine for growth in India. The highly populated country is one of the most attractive markets in Asia behind China - a fact not lost on German airport operator Fraport.
In September 2003, India's government decided to sell 74 percent of India's two major airports - Delhi and Mumbai. Now the government is looking for private companies to invest in the airports' expansion. Fraport is planning to invest a total of €30 to €50 million ($40 to $66 million) for a stake of about 10 percent in one of the two airports. "If we are going to be awarded the contract, we are going to first revise the airport's internal company processes," Thiesen explained. For this purpose, Fraport personnel have to be sent to India, training programs have to be set up, and the infrastructure needs to be improved.
Private airlines contend that liberalizing of aviation policies is pointless if infrastructure is not massively extended at the same time. Metropolitan airports suffered from extreme overload, they say. "If new airlines are to enter the market without infrastructure keeping up, the industry is headed for a disaster," Wolfgang Prock-Schauer, chief executive of the biggest private airline Jet Airways, warned.
More here...
- posted by katongking @ 9:50 am 0 comments
The aviation industry is regarded as an engine for growth in India. The highly populated country is one of the most attractive markets in Asia behind China - a fact not lost on German airport operator Fraport.
In September 2003, India's government decided to sell 74 percent of India's two major airports - Delhi and Mumbai. Now the government is looking for private companies to invest in the airports' expansion. Fraport is planning to invest a total of €30 to €50 million ($40 to $66 million) for a stake of about 10 percent in one of the two airports. "If we are going to be awarded the contract, we are going to first revise the airport's internal company processes," Thiesen explained. For this purpose, Fraport personnel have to be sent to India, training programs have to be set up, and the infrastructure needs to be improved.
Private airlines contend that liberalizing of aviation policies is pointless if infrastructure is not massively extended at the same time. Metropolitan airports suffered from extreme overload, they say. "If new airlines are to enter the market without infrastructure keeping up, the industry is headed for a disaster," Wolfgang Prock-Schauer, chief executive of the biggest private airline Jet Airways, warned.
More here...
- posted by katongking @ 9:50 am 0 comments
Thursday, February 24, 2005
Air India Express takes delivery of Boeing 737-800
Air India today took delivery of the first of the three Boeing 737-800 for its subsidiary AI Express for operations to the Gulf.
Beginning April end, the AI Express will fly a total of 37 flights a week primarily to Abu Dhabi and Sharjah. Three each of these flights will operate from Mumbai and Delhi, 31 services will operate from Kerala. The national carrier has also lined up a major expansion plan beginning next month with more frequencies and links to various destinations in the US.The airline is planning to connect Chicago and Los Angeles with a daily frequency from March 28 as against six and five services respectively at present. Delhi is to be connected thrice weekly with Los Angeles via Frankfurt while four flights would be operated out of Mumbai, Bhargava said.
- posted by katongking @ 2:51 pm 0 comments
Air India today took delivery of the first of the three Boeing 737-800 for its subsidiary AI Express for operations to the Gulf.
Beginning April end, the AI Express will fly a total of 37 flights a week primarily to Abu Dhabi and Sharjah. Three each of these flights will operate from Mumbai and Delhi, 31 services will operate from Kerala. The national carrier has also lined up a major expansion plan beginning next month with more frequencies and links to various destinations in the US.The airline is planning to connect Chicago and Los Angeles with a daily frequency from March 28 as against six and five services respectively at present. Delhi is to be connected thrice weekly with Los Angeles via Frankfurt while four flights would be operated out of Mumbai, Bhargava said.
- posted by katongking @ 2:51 pm 0 comments
Jet Airways - aggressively priced?
"... There is no denying the fact that Jet has carved a niche for itself in a short span of time and is today the country's most preferred airline on any parameter, but what is of concern to the prospective investor is the aggressive pricing by the company. Several issues have hit the market and pricing was never a major issue amongst investors, In the case of Jet, the opinion is divided. One view is that the pricing is very aggressive and that there is nothing left on the table for the investors while the other view is that Jet is playing on the growing Indian tourism market and is also set to gain substantially from the growing economy."
Summary of the analysis of Jet's prospects
Positives:
- posted by katongking @ 2:12 pm 0 comments
"... There is no denying the fact that Jet has carved a niche for itself in a short span of time and is today the country's most preferred airline on any parameter, but what is of concern to the prospective investor is the aggressive pricing by the company. Several issues have hit the market and pricing was never a major issue amongst investors, In the case of Jet, the opinion is divided. One view is that the pricing is very aggressive and that there is nothing left on the table for the investors while the other view is that Jet is playing on the growing Indian tourism market and is also set to gain substantially from the growing economy."
Summary of the analysis of Jet's prospects
Positives:
- Leading Airline
- Young fleet
- Focus on business travel
- Aircraft utilisation
- Strong brand and loyalty
- Access to airport facilities.
- Competitive industry
- Limited suppliers
- Vulnerable to delays
- Dependency on Mumbai
- High debt
Also, the IPO of Jet Airways received bids 7.8 times the issue size at the end of the fourth day of bidding. The response trend indicates that 90 per cent of demand is at Rs 1,125, the top end of the price band for bidding.
- posted by katongking @ 2:12 pm 0 comments
Airbus sells three A319s to Kingfisher
"Airbus said on Wednesday Indian budget carrier Kingfisher Airlines had signed a contract to buy three A319 aircraft. The deal comes on top of 10 orders for the A320 and options for a further 20 from the same airline, which will start taking deliveries of those planes in April. The A319s will be powered by International Aero Engines V2500s, Airbus said in a statement."
Where are they going to fly these planes??! That's a total of 13 aircraft, and they're buying them, not leasing. I suppose they will get deliveries of these 13 aircraft over a 2 year period. Even then, that's some pretty aggressive purchasing, considering their business model is not proven.
- posted by katongking @ 2:05 pm 0 comments
"Airbus said on Wednesday Indian budget carrier Kingfisher Airlines had signed a contract to buy three A319 aircraft. The deal comes on top of 10 orders for the A320 and options for a further 20 from the same airline, which will start taking deliveries of those planes in April. The A319s will be powered by International Aero Engines V2500s, Airbus said in a statement."
Where are they going to fly these planes??! That's a total of 13 aircraft, and they're buying them, not leasing. I suppose they will get deliveries of these 13 aircraft over a 2 year period. Even then, that's some pretty aggressive purchasing, considering their business model is not proven.
- posted by katongking @ 2:05 pm 0 comments
India is fertile soil for budget airlines (The Seattle Times)
As Air Deccan Flight 204 soared away from the runway, Ramana Murthy looked out the window and chatted animatedly on his cell phone. Never mind the rules. At 40, the boyish-looking railway contractor was taking his first airplane trip — and his wife, on the other end of the line, was demanding a full report.
"Is good feeling only," he said in faltering English a few minutes later, a broad grin lighting his face. "No fear. Just like sitting on a bus."
Once regarded as the province of tycoons and maharajahs, air travel is taking off in India. A booming economy and the emergence of no-frills service — modeled after that of low-cost U.S. carriers — are opening the skies to middle-class Indians eager for the conveniences of prosperity and globalization.
With Air Deccan offering fares as low as $11 — and other airlines scrambling to catch up — many Indians now have an alternative to the dirty and overcrowded trains that have long been synonymous with travel in this vast nation of more than 1 billion people.
Read more...
- posted by katongking @ 1:29 pm 0 comments
As Air Deccan Flight 204 soared away from the runway, Ramana Murthy looked out the window and chatted animatedly on his cell phone. Never mind the rules. At 40, the boyish-looking railway contractor was taking his first airplane trip — and his wife, on the other end of the line, was demanding a full report.
"Is good feeling only," he said in faltering English a few minutes later, a broad grin lighting his face. "No fear. Just like sitting on a bus."
Once regarded as the province of tycoons and maharajahs, air travel is taking off in India. A booming economy and the emergence of no-frills service — modeled after that of low-cost U.S. carriers — are opening the skies to middle-class Indians eager for the conveniences of prosperity and globalization.
With Air Deccan offering fares as low as $11 — and other airlines scrambling to catch up — many Indians now have an alternative to the dirty and overcrowded trains that have long been synonymous with travel in this vast nation of more than 1 billion people.
Read more...
- posted by katongking @ 1:29 pm 0 comments
