Low-cost carrier SpiceJet is ready to enter into talks with foreign carriers to offer a stake. Qatar Airways is understood to have already initiated talks, though the report has been denied by SpiceJet.
SpiceJet’s Senior Vice-President, Commercial, V. Raja, told Business Line a tie-up with an international carrier will ensure the airline is well funded to expand its footprint. The BSE-listed airline is scouting for funds to sustain as well as expand its operations.
According to consultancy firm Centre for Asia Pacific Aviation, the domestic airline industry is going through one of its roughest periods in history.
All airlines are expected to post losses amounting to Rs 3,000 crore during the second quarter of this fiscal. They will therefore urgently require funds. While some are looking at foreign airlines to infuse funds by picking up a stake, others are considering loans from financial institutions.
Foreign destinations
Raja said the airline will add two more foreign destinations during this fiscal — Dammam in Saudi Arabia, and Kaula Lumpur. It will bring the total number of foreign destinations it operates in to 12. Earlier this week, it opened a new international route to Bangkok.
The airline will use its existing fleet of Boeings to manage its international operations, Raja said. It has deployed some of the aircraft used for domestic operations to operate at nights on its international routes. It has also reduced operations to domestic routes that are currently unprofitable.
The airline’s GM for business development, Vipul Seth, said some of the older Boeings will be replaced with newer ones so that the average age of the fleet is maintained at about 2.5 years.
The Kalanithi Maran-owned airline had said early this month that it is leasing six Boeing 737-800s from Singapore-based BOC Aviation. It recently took delivery of the first of the Boeings; the rest will be delivered next year. All the Boeings are 189-seater, all-economy class. The airline has a total of 55 aircraft in its fleet including 15 Bombardier Q400s which are fully owned.
SpiceJet carried 7.86 lakh passengers in September 2013, giving it a market share of 17.3 per cent. The company’s shares closed on Friday at Rs 20.8, up 2.46 per cent from the previous closing. giriprakash.k@thehindu.co.in
(The writer is in Bangkok at the invitation of SpiceJet.)