Ronojoy Dutta, President and Chief Executive Officer of IndiGo, speaks to Businessline about the airline's latest decisions and its future course of action. Excerpts:

Do you see yourself bidding for Air India?

I need to be very sensitive and respectful of what the government is trying to do. The government clearly has a lot of eggs in the Air India basket. It needs to do the divestment and do it well.

I do not think people should be sitting on the sidelines and making any  comments. It is not fair to the government.  

But last time there was an unsolicited bid from your side?

There was. Now the issue is: Do I have a current view on that? I will say this to myself and everyone else: Let the government do its job.

Don’t you see taking part in Air India’s divestment as a way  forward for an airline like IndiGo?

If I say yes or no it affects the transaction because there are other people looking at it.

Unless one name comes out.... all we have heard is bad news about Air India’s divestment. Qatar is not interested, Air France KLM is not interested and United is not interested.

I do not want to make any statement on it. Yes. No. Thinking. What is good for Air India what is better for Air India. No comments. It is important for the country to make this privatisation happen.

It almost seems like you are playing catch up with SpiceJet. SpiceJet joins IATA, a few months later you join IATA. SpiceJet announces an MoU with Ras Al Khaima. A few days later you announce  a tie up with Qatar. 

I do not know if they are following us or we are following us. I do not look at the competitive landscape. Let Vistara do its stuff. Air Asia do its stuff. SpiceJet do its stuff.  It is good for the Indian aviation industry and economy. We are all innovative, competitive.

We are looking at what it will do for us.  

Now take the IATA example.  IATA is expensive. Not hugely expensive but it offers  some benefits like Bank Settlement Procedure (BSP) and International Clearing House (ICH). We did not need these before. Now as we start doing deals with Istanbul or Doha or  even travel agents in China,  BSP and ICH  become an issue.

We did the economics. We said if we go alone what does it cost us? If we through IATA what does it cost us? It was very much an economic decision.

So when are the widebody aircraft coming in?

It is under discussion, it is under debate. We are not going to get rushed into it.  I  also told you we cannot sacrifice profitability. So I do not want to rush into something which is not profitable.

Given the announcement with Qatar which allows 5 and 6 freedom from Doha onwards. Is that one of the options which IndiGo is looking at?

The non-stop will do better. Once you start with one-stop you are competing with 22 hubs. There are 22 different ways to get from Delhi to London. Then we said what if we did one stop here or there. The yields are so low that you are really bottom fishing. We want to go non-stop as that cuts through all the 22 different ways of getting there.

London will be with a leased widebody?  

Yes

You have not placed any orders for the widebody?  

Yes.

Any time slot?

No time slot. We are in experimental mode. We want to try, see if it works, and if necessary grow or cut back. So it will be a very flexible mode.

How  will this be an experimental approach and what do you mean by willing to cut back if it does not work out?  

We do not want to make a commitment on ordering 30 widebody. We are going to get 5 to 6  on lease and see if it works. If it works then we will order 30 widebody. But we are not going to plunge in with 30 widebody.

 

With 5 or 6  will you be able to do three times a week?

We have a built a schedule. No not three times a week. It is a daily service, one from Delhi and one from Mumbai. If we  have some left over we can do Singapore or Istanbul or something.

Are US  and Australia on the cards?  

US is definitely not there.  In general it is a bad idea to think about as it is very hard to make it work.

Australia?

It is a good market. It is not on our radar right now.  But eventually yes.

Related Topics