With some of the largest airports in the country such as Mumbai and Delhi nearing saturation, the next phase of growth for airlines could come from smaller towns and cities. Speaking with PRANAV MUKUL, SpiceJet chairman and managing director Ajay Singh tells that small airports are where the country’s second-largest budget carrier is looking to place the aircraft it is planning to induct. The airline currently has 205 Boeing 737 MAX and 50 Bombardier Q400 turboprop aircraft on order. Edited excerpts:
Airlines, including SpiceJet, have placed orders for hundreds of aircraft that will be coming in over the next five to ten years. Seeing that several large airports are constrained for infrastructure, what is the plan for this additional aircraft capacity?
Of course infrastructure is a constraint but we believe there’s a lot of capacity available in the smaller airports of India. We think a great deal of growth is also happening in these small cities and therefore, this is where a lot of these aircraft will be placed. Of course, we also want airports of Delhi and Mumbai to be expanded further but till that happens other airports are where our focus will be.
You recently placed a large engine order with Safran for CFM engines. What does this mean for the airline?
It’s one of the largest orders placed by an Indian company with a French company. As far as SpiceJet is concerned, it helps us bring down the cost of maintenance of our engines for the next ten years. It also helps us lower the fuel burn of our aircraft by up to 15 per cent, so the cost structure of SpiceJet will improve dramatically as a consequence of this order and that would mean that our margins will increase and we can be more competitive in the market.
Do you have an updated stand on bidding for Air India?
It’s a great asset and a great brand but it’s too large a company for somebody our size.
But what are the key strengths in Air India that a bidder would be looking at?
We will have to wait till the government announces the structure to what is happening with the debt. I am sure the government will work on reducing the debt for the new buyer. I think Air India has a great brand. Of course, it has several wide-body aircraft, good slots, a good schedule and certain reputation in the international market and these are all positives. It also has skilled manpower as well in form of large number of skilled people. The problems are well known – there is the debt, the contracts which may not have been negotiated with best of the commercial ability of a private party. The aircraft costs and the engineering costs could be very high.
We have seen across the globe that with growth in number of air travellers the passenger experience with airlines takes a toll. What is it that needs to be done to mitigate that?
This is something that really needs to be done. I think the problem is on both sides. Because of the rapid growth, perhaps, airlines have not been able to train people fast enough, especially in soft skills such as how to behave with passengers, how to be more patient with them, how to explain to them the basic rules of flying. We also have to remember that many of the passengers who are flying in Indian skies are doing so for the first time and are therefore not as conversant. So there is an added responsibility on the airlines to be more polite and more patient with them. This is something that airlines need to do, and SpiceJet is making a great deal of effort in training our employees in the softer skills in terms of teaching them patience and working with passengers, some of them who may never have flown before.