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.
Archive for the ‘Special Ones’ Category
Major airlines plan portal to save on commission
Sunday, 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Air India, Jet Airways and Kingfisher Airlines have earlier once withdrawn agent commission but had to soon restore it under pres-sure from thousands of travel agents across the country.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.
Fare cuts fail to revive aviation sector
Sunday, 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.
Domestic airlines asked to cut capacity, align flights
Saturday, April 11th, 2009The civil aviation ministry has asked domestic air carriers flying to foreign destinations not to compete with each other and align schedules of their flights for better returns. Early this week, ministry officials asked air-carriers to get rid of excess capacity on both foreign and domestic sectors and also reduce transit time to save on operational costs.
The suggestion was necessary as domestic airlines such as Air India, Jet Airways and Kingfisher are set to lose over Rs 8,000 crore due to stiff competition and rising jet fuel in 2008-09, a ministry official, who was present in the meeting, said.
Air India, Jet Airways and Kingfisher have already started rationalising routes and reduced capacity, he said requesting anonymity. The meeting, called to discuss ways to enhance operational efficiencies, was attended by executives of domestic airlines, airport operators and aviation regulator.
Goldman: Civil aerospace downturn may be ‘more severe’
Saturday, April 11th, 2009The downturn in the civil aerospace sector is expected to be more severe than previously estimated mainly due to a decline in world air traffic and global gross domestic product, said Goldman Sachs, which downgraded Rolls Royce Group by a notch to “sell”.
A further double-digit drop in world international air traffic data, which fell 10.1 per cent for February — the worst decline since the current crisis began, could put Airbus and Boeing under pressure to cut production schedules for the second half of 2009 and 2010, Goldman said.
The brokerage also said: “We believe further double-digit declines are likely for several more months as consumers and businesses seek to preserve cash in the face of economic uncertainty.”
Domestic air passenger traffic likely to plunge further
Saturday, April 11th, 2009Domestic air passenger traffic is likely to continue its negative trend in March despite aggressive fare cuts by airlines since January, according to initial estimates provided by travel agents.
Airlines flew 7% fewer passengers during February compared with the year ago period, data released by the Director General of Civil Aviation said. In January, the number of domestic air passengers fell to 3.32 million, compared to 3.33 million last year, the DGCA data said.
The Director General of Civil Aviation is scheduled to come out with its passenger figures for March, by the end of this month. Amadeus India managing director Ankur Bhatia said: “Domestic airlines cut fares by almost half in the January-February period, but the number of passengers keeps declining even now. There is no recovery in passengers load.” Amadeus is a global technology and distribution partner to the travel and tourism industry.
As jets lag, pre-paid model takes to the skies
Saturday, April 11th, 2009Private jet-setting is going the mobile telephony way, with the slowdown forcing small aircraft leasers to issue pre-paid packages
Jetliners such as BJETS, VistaJet and Club One Air now offer pre-paid ‘timeshares’ in which you can buy a fixed 25-hours “all-expenses-included” flying package for Rs 2.7 lakh or Rs 3.5 lakh per hour, with a validity of one year, and fly to any part of the world.
The trend was kicked off by VistaJet, Europe’s largest private jet carrier, which opened shop last month in India. “We are ready to close some new deals in the next two weeks. We offer a 7-seat Learjet 60 aircraft at $5,500 (Rs 2.7 lakh) per hour. It’s much cheaper than any other model in the market, as users don’t have to bear the expenses of crew stay, meals or fuel,” says Ankur Bhatia, executive director, Bird Group, which markets VistaJet in India.
Confused aviation?
Tuesday, March 31st, 2009Civil aviation in India is in a confused state. The question that arises: “Is it civil aviation or corrupt aviation”? A reality check on the progress of aviation during the last five years exposes the level of rot in the system.
Utopian claims have been made about growth prospects and growth rates in aviation. A case in point is the recent statement by the airport director of Chennai that the passenger numbers in 2010 is expected to be 24 million(?). In 2008, all the airports together handled only about 34 million passengers.
The International Air Transport Association (IATA) has predicted a dismal 2009, and yet tall claims are being made. Also, the airport infrastructure makes mockery of our credibility.
Recently, a team from the Federal Aviation Agency (FAA) of the US carried out an audit of Indian aviation. The threat of India being downgraded to Category 2 has been given a fresh lease of life. We have until June to set right all the deficiencies that warrant this downgrade. These are not deficiencies that cropped up recently.
Investor Wilbur Ross wants grand 3-way alliance in skies
Tuesday, March 31st, 2009Billionaire investor Wilbur Ross is trying to stitch together a mega alliance in the skies to create India’s second-largest airline according to a top aviation industry executive. This top executive who did not wish to be named told ET that Ross, who had pumped money into SpiceJet last year, is now working towards bringing on board — Jetlite and GoAir. His eventual plan, the official said, is to integrate the three low-cost carriers to create a combined entity which will command a market share of around 22.5%, way ahead of Indigo, which is currently the largest low-cost airline with 13.2% market share. Currently, Vijay Mallya’s Kingfisher Airlines is India’s largest carrier with a 27% share of the Indian skies.
Israel displaces Russia as top military supplier to India
Tuesday, March 31st, 2009Israel has displaced Russia as the leading weapons partner of India, signing contracts worth more than $1 billion for both the years 2007 and 2008. These contracts overhaul the Russian average of $875 million for both the years.
According to Israeli Maj Gen Udi Shani, director of the defence ministry’s Sibat export agency, Israel now shares a very special defence relationship with India. He was quoted by the Middle East Newsline as saying that both countries were now moving towards joint development of equipment.
Maj Gen Shani, on a visit to India in mid-February, apparently revealed that Israel and New Delhi were also discussing several defence projects, in addition to the ongoing ones. These projects would lay stress on reconnaissance and air defence.
India’s air defence
Thursday, March 19th, 2009The Obama administration has okayed the single largest arms transfer to India to date, telling the US Congress it has factored in “political, military, economic, human rights and arms control considerations” while approving the sale of eight Boeing P-8I maritime patrol aircraft worth $2.1 billion.
Low-cost airline to charge toilet fee- or maybe not
Wednesday, March 4th, 2009Ryanair’s chief executive said Europe’s largest budget carrier might start charging passengers for using the toilet while flying, but his spokesman cautioned Michael O’Leary often just made things up at will.
“One thing we have looked at in the past and are looking at again is the possibility of maybe putting a coin slot on the toilet door so that people might actually have to spend a pound ($1.43) to spend a penny in future,” O’Leary told BBC television.
He said this would not inconvenience passengers traveling without cash.
“I don’t think there is anybody in history that has got on board a Ryanair aircraft with less than a pound.”
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Air craft maintenance service in India from next year
Wednesday, March 4th, 2009Maintenance, repair and over haul services for aircrafts will be available in India for the first time from October 2010.GMR Infrastructure Ltd said on Friday that its unit GMR-Hyderabad International Airport Ltd (GMR-HIAL) and a wholly-owned unit of Malaysia Airlines will set up a 50:50 joint venture for airframe maintenance, repair and overhaul services (MRO). This move is expected to bring down the cost of maintenance of 350 odd aircrafts which are currently operating in India.
With MRO facilities becoming available in India, airlines are expected to save 10% -12% on cost of maintenance. Industry analysts also pointed out that till now while sending the carriers for maintenance to overseas operators used to loss out as it will be out of operation for 4 to 8 days. With the facility being available in India, airlines which are already reeling under losses are expected to get a breather on the low cost of maintenance and lesser down time. Airlines including Jet Airways and Indigo has already expressed interest in using the MRO facilities that will be available in Hyderabad.
Foreign airlines may own stakes in Indian carriers
Friday, January 2nd, 2009The government is considering a proposal to allow foreign airlines such as Singapore Airlines, British Airways and Lufthansa to pick up equity stakes in domestic carriers, but with riders.
It is preparing the ground for a major policy shift on foreign ownership in aviation. Government sources say foreign airlines may be allowed to own a 20-25% stake in local carriers, but their role on boards and in the management would be limited.
The civil aviation ministry had, in the past, argued that allowing larger foreign airlines to own stakes in fledgling Indian carriers could cause harm to the domestic aviation sector.
“Things have changed. Earlier, only one Indian airline operated internationally. But now, three domestic carriers fly to foreign destinations. Our carriers have grown in size and scale in three to four years’ time. We don’t think the earlier concerns are relevant. If foreign telecom companies can buy stakes in Indian telecom companies, why can’t foreign airlines pick up stakes in domestic airlines?” a government official asked, on the condition of anonymity.
ISRO to test high-end launch vehicle GSLV Mark III in 2009
Friday, January 2nd, 2009Following the launch of Chandrayaan last year, ISRO will roll out several ambitious initiatives to consolidate the gains and build on its last year’s achievements over the coming years. According to ISRO calendar the new year will mark a crucial testing phase in its development of Geosynchronous Satellite Launch Vehicle (GSLV) Mark III, which is slated for space flight in 2010-11.
GSLV Mark III is a next generation launch vehicle designed to put four tonne satellites into orbit. But more importantly, it is expected to cut the costs of launching satellites by half, to enable Antrix Corporation, ISRO’s commercial arm offer the cheapest space launches in the niche market. The current GSLV can put 2.2 tone satellites in orbit.
Ram Charan boards Gopinath’s cargo start-up as an advisor
Friday, December 26th, 2008Iconic business strategist Ram Charan is boarding Capt GR Gopinath’s start-up logistics company Deccan Express as an advisor. The new
venture is expected to kick off in May next year with a fleet of six cargo aircraft connecting 14 locations and supported by a trucking service that will reach out to 68 places across the country.
“Ram Charan will be on the company’s advisory panel, guiding the CEO and operational team every quarter. We are gearing up to launch services in May-June, with a fleet of three Airbus 310s and three ATRs having 14 air touchpoints. We will be the largest and double the size of existing industry players on day one,” Capt Gopinath, chairman & managing director, Deccan Express Logistics, said. Three more ATRs will be added to the fleet subsequently.
Our baby is on way to moon: Chandrayaan project director
Wednesday, October 22nd, 2008Some were eloquent, others struggled for words and yet others preferred one liners to describe the success of their years of hard work as the Chandrayaan-1 spacecraft soared into skies on Wednesday morning making India a member of the elite club of countries probing the moon.
"It’s a historic moment," said Indian Space Research Organisation chairman G Madhavan Nair.
"Our baby is on way to the moon," said Chandrayaan project director Mylswamy Annadurai.
"Words don’t come," said George Koshy, director of ISRO Space Application Centre, Ahmedabad.
Here are the quotes from top ISRO scientists after the spacecraft was placed in its orbit, a little over 18 minutes after a "perfect, textbook, beautiful" launch from this spaceport off the Andhra Pradesh coast, 80 km from Tamil Nadu capital Chennai.
Aircraft maintenance has $1-bn business potential in India
Wednesday, October 22nd, 2008Indian aviation industry may be going through turbulent weather, yet experts see a growing potential for the maintenance, repair and o
verhaul (MRO) segment of the industry, with projected revenue of $1.07 billion by 2013.
Many companies, including Boeing in a tie-up with the state-run Air India, have announced joint ventures in MRO business and others are waiting in the wings for the government to address some tax issues to jump into the market, the experts added.
Speaking during an MRO Asia symposium here, C.S. Tomar, vice president of engineering and maintenance for Kingfisher Airlines, said the MRO market in the country was currently valued at $405 million with a potential for $1.6 billion by 2018.
"It makes economical sense for us to set up an MRO facility," Sitham Nadarajah, vice president for technical development with Jet Airways, told IANS. "With volumes increasing, we will be looking at D-checks for narrow bodied aircraft like Boeing-737s."
The D-checks are done on aircraft every four-five years, during which the aircraft is completely stripped, checked and then restored.
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Indian carriers cut jobs, capacity to stay afloat
Wednesday, October 22nd, 2008Indian carriers, buffeted by softening demand, mounting losses and high jet fuel prices, are resorting to job cuts and reducing capacity to stay afloat.
Carriers have halted expansion plans and an alliance of the country’s top two carriers, Jet Airways and Kingfisher Airlines, is looking to return 14 narrow bodied planes.
Discount carrier SpiceJet cut 19 daily flights of its 117.
Kingfisher said it would reduce the salary of 50 trainee co-pilots, while state-run Air India plans to offer 3-5 years unpaid leave to 15,000 employees in non-core operational areas.
Kingfisher and Jet set up an alliance on Oct. 13 for code sharing, sharing of ticketing, ground services, fuel management, crew training and utilisation.
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Meet today to resolve jet fuel dues issue
Wednesday, October 22nd, 2008To amicably resolve the contentious issue of unpaid jet fuel bills of the public sector oil retailing companies by domestic airlines, the Ministers of Petroleum and Civil Aviation have called for a meeting of the industry and officials here on Wednesday.
Indications are that the Petroleum Minister, Mr Murli Deora, and the Civil Aviation Minister, Mr Praful Patel, have been asked by the Prime Minister, Dr Manmohan Singh, to sort out the issue at the earliest.
Mr Deora told newspersons here on the sidelines of an auto event, “We want to help these airlines and so I have called a meeting to explore all the options.” The Finance Ministry representatives are also expected to attend the meeting. Sources told Business Line that the options which could be considered include extending of the current grace period given to domestic airlines to pay their fuel bills and a possible restructuring in the aviation turbine fuel (ATF) duty structure, which is essentially in the domain of the Finance Ministry.
While the PSU retailers have brought down the base price of ATF by almost 20 per cent in the last two months, the airlines still end up paying a higher price. This is since over the base price is added customs duty of five per cent, excise duty at the rate of eight per cent, three per cent education cess and sales tax at an average of 25 per cent. Highest sales tax component on ATF is in Maharashtra.
