Capt G R Gopinath, who sold the low-cost carrier Air Deccan in 2007 to Kingfisher Airlines, has incubated a new project: Deccan Cargo & Express Logistics. Despite losing the Lok Sabha election, where he hoped to represent Bangalore in the lower house of Parliament, he is upbeat about his recently launched air cargo business. In a freewheeling interview with ET, Deccan Cargo & Express Logistics CMD Capt Gopinath explains why his cargo business will revolutionise the sector and what the new government could do to alter the aviation scenario.
Cash-strapped AI must prune order for new planes: Govt
June 21st, 2009The government is likely to tell the cashstrapped Air India to prune its order for 111 planes that would cost the exchequer about Rs 44,000 crore. This order was placed three years ago when the aviation industry in India was growing at nearly 30% and the economy booming.
But, now, in this slowdown, almost all airlines are struggling to remain afloat and AI is seeking a bailout from the government to survive. Nearly 45 of the ordered planes have already joined the Maharaja’s fleet.
Air India asks senior staff to forego July pay to cut costs
June 21st, 2009Air India today requested its top management and senior officials to voluntarily forego their salary and productivity-linked incentives for July to help the cash-strapped and crisis-ridden airline.
Air India CMD Arvind Jadhav requested all executives in the level of general managers and above to voluntarily forego salaries and incentives for July as a gesture to ease the liquidity crunch faced by the airline, an Air India spokesperson told PTI.
Paramount Airways to buy 10 Airbus A321s
June 21st, 2009Aiming at launching international services, all-business-class carrier Paramount Airways today placed a $1.5 billion order for acquiring 10 Airbus A-321 aircraft with each of them costing over $900 million.
Paramount signed a memorandum of understanding (MoU) with the major European aircraft manufacturers on the sidelines of the ongoing Paris Airshow at Le Bourget in France.
Local carriers may lose parking slots on fleet cut
June 21st, 2009Domestic carriers such as Jet Airways and Kingfisher Airlines, which are reducing their fleet sizes, may also have to surrender aircraft parking slots at airports. As most of the metro airports are congested due to increase in air traffic, the move will help in allotting parking slots to other carriers, a senior official in the civil aviation ministry said.
Airport Authority of India (AAI) has proposed that airlines must surrender parking slots if they sell or lease their aircraft so that airports can accommodate other airlines, especially budget carriers, he said requesting anonymity.
Samtel expects orders of 20,000 Airbus cockpit full colour displays
June 21st, 2009Indian electronics giant Samtel sees orders worth $100-150 million over the next decade for the full colour display (FCD) it has jointly developed with French defence and aerospace major Thales for the Airbus A-320/340 aircraft.
“We are looking at orders in the region of 20,000 FCUs over the next 10 years. It’s a long-term project,” an upbeat Puneet Kaura, executive director of Samtel Display Systems, said on the phone from the French capital where the FCD was unveiled for the first time at the Paris Air Show.
Air India hikes fuel surcharge on ATF rise
June 21st, 2009State-run Air India said it will raise fuel surcharge on tickets from June 19, following similar moves by other carriers.
“We are increasing the fuel surcharge by Rs 400 effective tomorrow (Friday),” its spokesman said on Thursday, adding the higher fares were for both long and short haul routes on the domestic sector.
Earlier in the day, low-cost carrier SpiceJet Ltd raised its fuel surcharge on tickets by 400 rupees following a rise in jet fuel prices, a senior official said.
Jet Airways raises fuel surcharge post-ATF hike
June 21st, 2009Jet Airways on Wednesday said that it has raised the fuel surcharge on tickets by 400 rupees across all domestic sectors effective June 17.
The move comes a day after state-run oil firms raised jet fuel prices by over 12 per cent from June 16, according to the website of Indian Oil Corp.’s, the country’s biggest refiner.
Indian carriers may retain special US security status
June 21st, 2009Indian carriers may continue to enjoy the security comforts while flying to the US destinations as the country is likely to retain
category-I status. India has met almost all safety-related norms specified by the American aviation regulator, an official in the civil aviation ministry said requesting anonymity.
The Federal Aviation Administration (FAA) in its assessment of the country’s aviation safety environment had found many loopholes in areas such as airworthiness, surveillance of flight operation, technical staff shortage and cabin safety. Failing to meet FAA-specified requirements had put the country at risk of being downgraded by the US regulator to Category-II status. A downgrade by FAA bars domestic carriers flying to the US under scanner. It also makes it difficult for any new carrier to start flights to the US.
Delhi, Mumbai airports on IATA’s ”wall of shame” for high charges
June 21st, 2009Industry trade body for airlines, the International Air Transport Association (IATA), has severely criticised the high aeronautical charges and taxes prevalent in India. In its recently held annual general meeting at Kuala Lumpur, IATA put the Delhi and Mumbai airports on its ‘Wall of Shame’ for hiking airport charges by as much as 207 per cent.
”Malaysia reduced airport charges by 50 per cent in March… in response to the economic environment. Singapore, China and Thailand have taken similarly positive measures,” IATA director general and CEO Giovanni Bisignani said.
Govt help could come with strings attached: AI chief
June 21st, 2009The Air India Chairman and Managing Director, Mr Arvind Jadhav, has asked the airline’s 31,500 employees to rise to the challenge that the current financial crisis poses.
“We should consider ourselves fortunate that we have been insulated from the adverse impact of the economic meltdown so far,” he said in a letter issued on Saturday.
Admitting that the airline has approached the Government, as the owner of the airline, for infusion of funds by way of equity and soft loans, Mr Jadhav hoped the Government would “extend a helping hand soon”.
However, he also cautioned that financial help from the Government could come with strings attached. “We also need to be conscious of the impact that disinvestment/privatisation can have on our lives, should this materialise,” the letter added.
Gopinath ready to offload 10% stake in Kingfisher
May 17th, 2009With no private equity deal expected soon to finance his cargo business, Captain Gopinath, pioneer of low-cost flying in India, is open to the idea of selling his 10% stake in Vijay Mallaya’s Kingfisher Airlines.
“A couple of PE investors have approached us to invest in the cargo business, but I have postponed the process now. We will revisit it a few months later, if the valuation improves,” said Gopinath, chairman and managing director of wholly-owned Deccan Express Logistics (DEL).
The $625-million domestic express cargo market is expected to grow at 20% a year over the next five years. On his willingness to dilute his stake in Kingfisher Airlines, Gopinath said: “It depends on the valuation I get.” At today’s market price, his 10% stake is valued at Rs 51 crore.
Gopinath has already pumped in Rs 125 crore in Deccan Express Logistics and needs to raise an additional Rs 150 crore. The company, branded as Deccan 360, is expected to launch the first dedicated cargo service in India on May 27. It has already inducted an Airbus A-310 and will add two more next month.
Foreign carriers forced to offer promotional fares
May 17th, 2009Slackening demand even during the peak season is forcing foreign carriers to offer promotional fares. After Jet Airways announced special fare on India-London route and Malaysian Airlines cut down fuel surcharge, Emirates has launched ‘kids go free’ offer to travellers flying from India to Dubai.
International air traffic fell 1.8% to 2.61 million in March this year over corresponding month last year. While the global slowdown has already hit hard air travels across the world, the recent outbreak of swine flu in Mexico further dented the aviation sector.
Jet to retrench excess staff, blames slowdown
May 17th, 2009Jet Airways on Friday said it would retrench excess staff to tackle the financial crisis it faces following the global slowdown, but stressed that reports of huge layoffs were overstated.
“Retrenchment is the last resort for us. We have excess staff,” a Jet Airways spokesperson told reporters. “But reports appearing in the media about huge layoffs are grossly overstated.”
Justifying the decision, the carrier said the worldwide economic slowdown has had an adverse impact on all businesses including the aviation sector.
SpiceJet offers 50 percent discount on kids’ fares
May 17th, 2009In a bid to attract families during the summer vacations, low-cost carrier SpiceJet is offering 50 per cent discount on fares for children aged between two and 12 years, the airlines said on Friday. But the bookings have to be made between May 15 and 18.
The special fares under the four-day promotion scheme for children will be applicable only three particular days a week - Tuesday, Wednesday and Thursday.
Major airlines plan portal to save on commission
May 17th, 2009Domestic air-carriers Kingfisher Airlines, SpiceJet and IndiGo have found a way to save on agent commission and service charge. The three, under the banner of Federation of Indian Airlines (FIA), are planning to launch a travel portal — rang7 — to sell air tickets. The industry body is expected to take up the proposal in its next meeting, a person familiar with the development said.
Air India, Jet Airways and Kingfisher Airlines have earlier once withdrawn agent commission but had to soon restore it under pres-sure from thousands of travel agents across the country. According to industry estimates, distribution of air tickets through travel agents and travel portals such as Makemytrip.com and Yatra.com costs airlines nearly Rs 200 crore annually.
I still dream of owning a low-cost air-carrier: Capt Gopinath
May 17th, 2009Two years after selling his budget carrier, Air Deccan to Vijay Mallya-owned Kingfisher Airlines, its former Chairman Captain G R Gopinath, still harbours a dream to return to the low-cost airline segment which he pioneered in the country.
“It is my dream…the country needs a true low-cost airline,” Captain Gopinath told reporters here on Thursday.
The Bangalore-based entrepreneur, who is now the Chairman of Deccan Express Logistics, a cargo airline said that he had the option to buy a 10 per cent equity in any domestic air-carrier, as per his agreement with Kingfisher.
“I can buy equity up to 10 per cent in any of the airlines….but right now I am focusing on cargo…but of course, the dream (to launch an airline) is there,” Gopinath told reporters here on Thursday.
Passengers ignore boarding call
May 17th, 2009Peak travel season and a drop in air fares have failed to stem a decline in the growth of the domestic air travel industry for the eleventh straight month, with full-service carriers Jet Airways and Kingfisher Airlines taking the biggest hit. April alone saw a 15% dip in the number of passengers flown by Indian carriers, according to data released by the regulator, the Directorate General of Civil Aviation (DGCA).
Jet Airways shows 50 employees the door
May 17th, 2009The country’s second-largest private carrier Jet Airways has sacked 50 employees and referred them to an in-house out placement cell, which will help the employees look for jobs with other airlines. Interestingly, Jet has taken this decision when the country has just concluded its general elections with formation of the new government just some days away.
The airline has suffered mounting losses coupled with rising debts. Sources familiar with the development said there will be another round of retrenchment, as the cabin crew has filed its attendance only till May 15. Responding to a query, Jet Airways spokesperson in an e-mail response said the airline has issued notices of termination to some cabin crew on probation in accordance with the terms of their contracts and in compliance with the law. Last year, the airline had given termination notices to some 1,900 employees, which had to be revoked after the government had to intervene and huge protests from its
Fare cuts fail to revive aviation sector
May 17th, 2009Air travellers could be treated with another round of fare cuts, as the country’s leading full-service carriers take a fresh aim at the budget-airline space amid worries about the deteriorating financials of the industry.
The country’s oldest private carrier Jet Airways, which already operates a wholly-owned low-cost airline JetLite, has launched another low-cost service JetKonnect, while Kingfisher Airlines is increasing the number of flights on low-cost Kingfisher Red routes. There are early indications that the country’s largest budget airlines — IndiGo and SpiceJet — will respond aggressively to the development.
