Akasa Air, India’s newest airline-to-be, awaits the last nod from the government even as the country’s air travel need takes its latest hit during the third Covid wave.
The airline, majority-owned by Rakesh Jhunjhunwala and co-founded by former IndiGo president Aditya Ghosh, has ordered 72 Boeing Max 737 aircraft and aims to begin flying this summer.
Vinay Dube, Founder, Managing Director, and CEO, and the main mind after Akasa, talks to Anirban Chowdhury. about its business model, plans, market potential, and how technology will be a key differentiator for the airline.
The Airport Authority of India
Not at this moment. We still have our plans to establish by this summer: in the May, June, July timeframe. We are still operating on the regulatory support that is needed for us to begin and many other things beyond the regulatory approvals that an airline needs to launch commercial operations. And so, all of that is operating and we’re on track.
There is no change in our system. We have not yet locked in on the first or second routes that we will operate on. We will work with various airports, both private and the Airport Authority of India to see what we get from them in terms of slots and parking bays, and other items that are needed for an airline to be able to nail down its schedule, at a certain level of detail.
When do you wish to get your first Boeing 737 aircraft?
- The first aircraft will come sometime after the 15th of April. We will require the first aircraft for the completion of our air operators’ certification (AOC) process. I think we’d like to have 18 aircraft by March 2023. We will have a team and a network that is commensurate with that tally. We currently have over 50 people. We have begun recruiting cockpit and cabin crew. We have also begun recruiting ground personnel.
You are entering the industry when the pandemic has affected need but also created pent-up reserves of it…We are entering aviation for what we feel is going to be an industry that will continue to increase for the next 20 to 50 years plus. And so, we are entering not to be able to take advantage of the timing but for the demand that we think is going to be growing in India for the next several decades. We’re in it for the long run.
Was the airlines’ network dependable?
Definitely. I think airlines recreate a part both in servicing existing needs as well as growing need…and not through just fares, although the fare is an important part as well.
The affordability of air travel has to be in line with other modes of transport. We will be part of that. We will be one of the most reliable and affordable airlines in India. But it’s also about whether you got warm and efficient customer service? Was the airlines’ network dependable? Do you leave time? Do you come on time? So, all of that plays a part in a passengers’ selection process.
There have been talks of Akasa fashioning itself as an ultra-low-cost carrier (ULCC). Would you set the record straight on that?
We have no intention at all of being a ULCC. And I believe there’s been a bit of misunderstanding in the way it reached out initially. I want to overcome the rumors of the ULCC model right now so that it’s never associated with Akasa.
We like to be an affordable airline.
And that is our business model. We will have a single type of aircraft, a single category of seats, we are not going to have a business class, we’re not going to have a premium economy, we will have a purchase onboard, like others in our category.
You have plans to eventually fly international…That is right. The Boeing 737 Max can fly to many destinations in the neighboring countries, but also into Southeast Asia, the Middle East, etc. And we will be taking full advantage of that range.
India has a very high-cost structure. Profitability is tough and margins are always affected.
While we are a new entrant in the market, this airline is being formed by a very professional group of founders. And we’re getting that experience to bear and the way we establish our airline from day one. And one of the most important elements of an airline’s longevity and profitability is its price structure. In our opinion, we will be able to establish a highly competitive price structure so that we have no concerns about our ability to compete in the long run.
And so, it’s the combination of, you know, a highly competitive cost structure, a warm and reliable airline product, and healthy demand for the next several years … all that give us optimism to be able to create an airline that is here for the long haul.
Will the help of technology and data analytics be a key differentiator in Akasa’s offering?
Yes, I believe we will focus on the help of technology and data analytics to run a very scientific, customer-centric airline. I suppose.
we will focus on the help of technology and data analytics to run a very scientific, customer-centric airline. I think there’s a lot more we can do to enhance the shopping experience for our customers, to make the purchase experience much more efficient. Onboard flights (including onboard retail sales) and post-travel, there’s a lot more we can do in terms of servicing our customers.
we over localized aviation in India
Do you think that running an airline in India requires a different skillset? What have your experiences in Jet Airways and Go First taught you?
We are all a total of our experiences. But I will say though that sometimes we over localized aviation in India. I will say that there are as many things we can learn about aviation in India not just from our Indian experiences but also the world at big also from airlines that we haven’t operated at. So, at Akasa, we test and look at airlines from across the world and see what we can learn from them.
What does aviation in India look like over the following decade?
In the long run, India will still have a very, very robust aviation future. There’s going to be a lot of need, if you look at, the growing middle class, the strong economic development, increasing disposable incomes, the kind of experiences that our young demographic in India is looking, the affordability for first-time flyers, whose time is incredibly valuable … why should a traveler have to expend 36 hours in a train and a four-hour bus ride on top of that to get into the deepest villages in India? Why is their timeless valuable?
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Akasa wants to participate in that development story, be that airline that allows power India’s development engine, that continues to democratize air travel for everyday Indians, that brings affordable travel to people.
Thank you
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Source: Economic times
