"A separate cabin for servants"

An Indian royal is banking on his heritage to fill seats in his latest
venture -- a luxury domestic airline that will even have a separate cabin for
servants.

...

"We're targeting the type or person who drives in a Mercedes," he told The Associated Press in a telephone interview from Mysore.

The bulk of the seats will essentially be what other airlines sell as first class -- seats will be 54 inches (137 centimeters) wide, about triple the standard 18-inch (46-centimeter) economy seat, he said, adding that fares will be competitive for their class.

There will, however, be an economy cabin of between 8 and 15 seats "for servants," Wodeyar said.

"There are people who many want to travel with one or two servants," he explained. "But they don't have to fly in the same cabin."

Um, 'servants'?

A luxury airline is not new, but the incumbents have catered more for a slightly elevated class, rather than the royalty targeted by the Maharaja's 'Palace in the Sky'. I wonder which routes he'll start with, given he will have to comply with the DGCA's route dispersal guidelines.. I can't imagine too many royalty (or people of their 'class') wishing to fly to Gauhati or Imphal.

And what's this business of 'servants'? Hello, what century are you living in O exalted Maharaja?

Getting down to numbers,

... he said the startup cost should be about US$100 million (euro81.46 million) and that initially the airline will have only two planes. The fleet should grow to 21 jets within the first 18 months of operation, he said, adding that the airline would eventually fly to more than three dozen cities.

$100 million for 2 aircraft? Something's not right. Considering Air Deccan secured $40 million in their second round of funding (and they're not doing too badly either) I struggle to comprehend where he got that figure from. Even considering that the cabin interior will not be as spartan as that of an Air Deccan, it still seems a touch too much. Perhaps he's just making a show by flashing some insane sum around. Memories of IndiGo...

And even if it's $100m, where's he going to get that money from? Our man is worth Rs 1522 cr, or about $340 million, but my guess is very little of that is liquid (10%?), and the rest is valuation of his properties and other assets.

Bottomline, he has some money to launch an airline in my opinion (but not $100m), he has grand plans, which will need a big dose of reality over the next few days and weeks. And he needs some good airline advisors (and not whom he's talking to now). And he will probably need to look for some aircraft soon.

- posted by katongking @ 1:15 pm   2 comments

Paramount launches (and this website relaunches)

Paramount Airways launched its first flight last week (Sept 7th).

With the new entrant in the civil aviation sector, Paramount Airways, securing the licence to import the 70-seater Embraer jet, the all Business class seats configuration airline, is set to take-off with its inaugural flight between Madurai and Coimbatore on September 7.

M. Thiagarajan, Managing Director of Paramount Airways, told The Hindu here on Thursday that the Union Minister of State for Civil Aviation, Praful Patel, would inaugurate the maiden Madurai-Coimbatore flight. From September 8, the airline will begin daily flights linking Coimbatore to New Delhi and then on to Kochi.

It remains to be seen how far Paramount will actually get. Its focus at the start is on the "long thin" routes, sectors that haven't been served by traditional carriers that focus on volume. I believe this is a good strategy for a number of reasons:

1. You have a small number of aircraft, with a small number of seats. Yes, the breakeven load factor will be higher, but the absolute number of seats you need to fill will be lower than for a larger aircraft. Chances are: with their 70 seater aircraft, they will need to fill just about 50 to 55 seats per flight. Shouldn't be too hard.
2. You don't fight with other carriers for passengers, and therefore you don't get into a price war. When you're starting out, even if you have deep pockets, people like Jet and Kingfisher have even deeper pockets and will kill you. Better keep a low profile till you have a critical mass of assets and customers, before trying to steal market share from the incumbents.
3. You don't fight for airport slots. Look at the logjam at Mumbai and Delhi now, and you'll see what I mean. The congestion plays havoc with your schedules and punctuality. If your target customers are business men, you need both to ensure survival.

Pricing - I don't know. Coimbatore to Delhi at Rs 13,999 (USD 320) is high for a flight time of just under 3 hours. Well, high by international standards, but considering their value lies in the class of service they plan, it might make for a competitive concept.

Their website sucks royally. It's really bad. I little bird told me that I7's management is very, shall we say, tight-fisted. The focus on their booking system and website is less on customer service and reliability, and more on cost per transaction. Fyi, their booking engine is the same one powering Kingfisher (and was built for Kingfisher). If the booking engine does not perform as required, there's going to be a ruckus.

- posted by katongking @ 1:26 pm   0 comments