3rd India Airport & Airline 2009 Expo

AAI: Better services & reduce charges – A key to make more profit
21 Apr, 2008

According to Airports Authority of India (AAI) Chairman, Mr. K. Ramalingam, there is a need to offer better services and reduce various charges charged by airports in order to increase profitability. He also said that airports should look for other sources of generating non-traffic revenues to make more profit. Speaking at the inaugural session of the five-day Workshop and International Conference on Air Transport, Air Law and Regulation in New Delhi he added, ‘In last two-three years, the aviation sector has witnessed a sea-change, which include infrastructural as well as technical. This has given rise to some legal issues, which needs to be dealt with.’ He also said that the central government and the AAI has made all efforts to provide better and advanced infrastructure to air travelers.

Aviation industry requires 6,000 more pilots in 5 yrs

The Indian aviation industry, is currently facing a shortage of 1,000 certified pilots. Further, it is estimated that there will be a requirement of 6000 additional pilots (5,000 for scheduled operations and 1,000 pilots for non-scheduled and private operations) in the next five years.

The Government has taken various steps to meet this demand-supply gap. This inclides increasing the retirement age for pilots to 65 years, setting up training institute in Maharashtra and up-grading as well as modernizing the infrastructure at the India Gandhi Rashtriya Udaan Akademi to increase training capacity from 40 to 100 pilots and reduce the training period.

Global Aviation giants have submitted tenders to sell 126 warplanes worth US$ 12 billion. The Defense Ministry has received proposals from 6 aeronautical companies from Russia, Lockheed Martin (offering F-16s), European Aeronautic Defence and Space Company (EADS) (offering Typhoon Eurofighter), and Seattle-based Boeing (offering F-18 Superhornets) amongst other leading companies.

Boeing has decided to outsource two components of the F-18 Super Hornet combat aircraft to India and one order could go to Tata group. Both the components are made with sophisticated composite materials, appropriate technology for which will be transferred to India.

Boeing could also procure some components for its Apache Combat helicopter and the Heavy Lift Chinook CH 47 helicopter from India and the viability of those projects is yet to be assessed.

Earlier in the month Boeing had formed a partnership with a unit of India’s Tata Group to test and validate a supercomputer to run aerodynamic simulations for the aircraft maker to help design and develop airplane wings.

Air India’s cargo business has grown in the last year such that the company’s ranking in the air cargo business has moved from ninth position to fourth in January of this year and according to the recent figures released by Airports Authority of India achieved the topmost position in March.

The national carrier’s focused initiative to expand its business in both local and international markets, cargo incentive schemes for cargo agents, pricing support at competitive rates and spot rate approvals, specific measures to enhance loads on freighter flights, joint sales calls and advertising have assisted this growth.

The Union Cabinet cleared two important airport policy initiatives allowing private developers for setting up captive airstrips and general airports moves with the objective of decongesting air traffic. The Government has allowed for case-by-case approval of greenfield projects within 150 km of an existing airport and in a major relaxation, the Civil Aviation Ministry and the DGCA will henceforth decide on all such proposals after security clearance from the ministry of home affairs.

The Board of Approval in the Commerce Ministry will take up the Bangalore International Airport Ltd (BIAL) proposal for setting up an airport-based Special Economic Zone. The project has already received a no objection certificate from the Karnataka government. The operation which is nearly complete is coming up at an area of 113 hectares at Devenahalli. This SEZ will have global retail outlets with products like liquor, luxury and premium perfumes, cosmetics, arts and crafts from local artisans and international fashion, apparel, jewelry and accessories.

Jet Airways, which was looking at sites in Bangalore, Hyderabad and Nagpur for setting up a maintenance facility, has signed a framework agreement with Bangalore International Airport Ltd (BIAL) for sub-leasing land to construct a base for maintenance and engineering facility at the new airport in the city. The MRO is expected to come up by 2010. However, the Company didn’t reveal any details about the agreement.

Czech Republic is planning to introduce its latest innovation of Mobile airports - an airport, which can be transported in trucks and set up anywhere in 20 minutes – soon in the Northeastern part of India i.e. Mizoram and Meghalaya. These portable or mobile airports have capacity to handle aircraft loads of 26-40 tonnes. Czech aviation companies are operating in as many as 27 countries.

The Delhi International Airport Ltd (DIAL) is planning to build four new terminals in Delhi with an investment of US$ 7,369 million and also has plans to build a fourth runway by 2026. This expansion will be done in phases. The 3rd terminal, which is expected to be set up by 2010, would have 55 aerobridges and 30 remote parking bays and would increase passenger handling capacity to 60 million per annum. After that, it is planned that a new terminal will be added every five years until 2025.

Bengaluru International Airport was to go through key inspection of the facilities at airport by DGCA officials in April and is hoping that all the outstanding issues have been sorted out and the commercial operations can be launched on May 11. During the two earlier inspections between January and March, the DGCA team had listed out 55 things to be done, of which 12 were outstanding in March. It is being estimated that this 40 day postponement of the commercial launch has costed BIAL USD 10 million.

According to sources, German airline Lufthansa is planning to acquire Brussels Airlines and that both companies have not yet reached a value for the Belgian operator.

UAE based Emirates is planning to launch its service from Kozhikode to Dubai from July 01, 2008. It is planning a six-flights-a-week service with more than 2000 seats and about 100 tonnes of cargo capacity per week per direction. This would be the airline’s third gateway in Kerala after Kochi and Thiruvananthapuram and its 10th destination in India.

Earlier in the week, UAE’s fourth national airline had announced the launch of a daily non-stop flight service to Kozhikode. RAK Airways would be operating Boeing 757 aircraft with the capacity of accommodating 194 passengers –- 174 in economy class and 20 in business class -- for its Kozhikode service. It has Malayalam speaking cabin crew and traditional menu on board. The Company is also planning to add one or two destinations to India soon as a part of its expansion strategy.

India and UAE signed a MoU on April 24, 2008 to give a boost to the Country’s air service to Middle-east. The agreement has added Calicut as an additional point of call and is expected to add 23 thousand seats per week in each direction.

Jet Airways has launched two flights from Abu Dhabi to Delhi and Mumbai and hence increased the number of international destinations being serviced to 16. The carrier is expected to add more routes from Abu Dhabi in 2008 winter and summer of 2009. This increase in the number of routes among India and Abu Dhabi is likely to attract interest from travelers in both countries.

Gulf Air is all set to add Hyderabad as it’s eighth destination by starting it’s daily non-stop service to the city from July 01. This will increase total India frequencies for the airline to 68 weekly or 11,500 seats per week. Gulf Air is also operating to Mumbai, Delhi, Madras, Cochin, Bangalore, Trivandrum and Kolkata.

Jet Airways, private air-carrier has launched a direct service between Mumbai and Muscat. This service will be in addition to the airline's current daily service from Kochi and Kozhikode (Calicut) to Muscat.

Paramount is planning to launch nine more daily flights in southern region of India. Four among these nine flights would operate between Chennai & Cochin along with Hyderabad & Chennai routes. Additional five will start from April 28, 2008 and they follow the Bengaluru-Hyderabad and Bengaluru-Chennai route. The Company is also planning to connect Vizag from Chennai via Hyderabad to cater to peak season.

Jet has ventured into a partnership deal with Global Hotel Alliance. This deal has taken place for JetPrivilege frequent flyers programme. This partnership facilitates JetPrivilege members to earn the 500 JP Miles for every eligible stay and platinum members would be entitled to other benefits such as early check-in/check-out and up-gradation of room category across some of the Alliance hotels. The Global Hotel Alliance, which has 163 upscale and luxury hotels with 52 thousand rooms in 126 cities across 42 countries, has a select number of it’s hotels where this offer can be availed.

Jet Airways is planning to launch its Mumbai-Shanghai-San Francisco services from 1st week of June. The airline has received the permit from China to pick passengers from the country and fly them to US. The Company is also planning to launch a sales promotion campaign in India and China to promote its service. Jet is also talking with various Chinese carriers for partnerships for providing connectivity in the region.

Premier Tours and Travels (Chennai) Pvt Ltd is launching Air Dravida with an initial investment of US$ 27.05 million. The new airline will start three flights in Chennai – Mudurai sector from July end and is planning to expand its operations by adding two more flights in South India within two months from its inception. While US$ 9.83 million of the initial investment would be raised through the Company promoters and US$ 17.21 million would be raised through debts and private equity routes. The new airline would begin its operations with 50 seater Bombardier aircraft.

Kingfisher Airlines Chairman and COO, Mr. Vijay Mallya announced that the merger between Kingfisher and Deccan Aviation will come in effect when it gets a nod from Karnataka High court. After the approval, the joint entity will be called Kingfisher Airlines Ltd, the largest airline in India, with a market share of 30%, 8 points ahead of Jet.

Mr. Mallya quoted that "The shareholders meetings of both Kingfisher and Deccan Aviation held under the orders of Karnataka High court went off smoothly, resolutions were passed. There has been a ballot. We are just waiting for the approval by the High Court."

The joined entity - Kingfisher and Deccan – is also getting ready to take on arch competitor Jet on global routes by launching its overseas flights in August using Deccan’s entitlements.

SpiceJet has launched ticket home-delivery service – SpiceExpress in partnership with the logistics company ExpressIT. The service can be availed by passengers booking their ticket through the airline’s call centre and the tickets would be delivered within 24 hrs at a cost of US$ 2.75 per passenger.

Cathay Pacific Airways is planning to launch more flights to several Indian cities following the air services agreement between India and Hong Kong. The airline is planning to connect Hong Kong with Chennai from June 03, 2008 with four-times a week service. It’s wholly owned subsidiary Dragonair would be starting Hong Kong - Bangalore daily service in May. The airline had recently increased the number of flights from Hong Kong to Delhi from 4 to 14 a week and also Hong Kong - Mumbai to 10 from 4 flights a week.

The freight carried by the airline in the Indian market would also go up with the growing operations in the country.

Kingfisher Airlines is increasing its service on six new sectors, which includes two daily flights to Chennai from Coimbatore which were launched on April 14th with brand new ATR aircraft offering personalized in-flight entertainment on every seat, world class service and gourmet cuisine.

The airline would offer a daily same day return flight between Delhi and Chandigarh and a daily direct flight between Delhi and Goa. It would also add one more daily direct flight from Delhi to Hyderabad. It is planning to launch flights from Mumbai to Chandigarh and Mumbai to Ahmedabad.