Follow Us:
Saturday, December 04, 2021

‘With curbs relaxing, it’s an opportunity to grow, expand further,’ says Vistara’s chief commercial officer

Vinod Kannan, who is set to become the airline’s chief executive Jan 1 onwards, also spoke about Vistara’s growth plans in the face of Tata Group acquiring Air India, and the importance of market share in the domestic segment particularly given the imminent entry of two new airlines.

Written by Pranav Mukul |
Updated: November 9, 2021 9:55:26 am
Vinod Kannan

Tata Group and Singapore Airlines’ joint-venture airline Vistara, which launched its service to Paris this month, is awaiting further relaxation of restrictions as an opportunity to expand its footprint internationally, the airline’s chief commercial officer Vinod Kannan told The Indian Express in an interview. Kannan, who is set to become the airline’s chief executive January 1 onwards, also spoke about Vistara’s growth plans in the face of Tata Group acquiring Air India, and the importance of market share in the domestic segment particularly given the imminent entry of two new airlines. Edited excerpts:

Has Covid had an impact on flyer behaviour and is it expected to last?

I would address this across a few areas. The first thing is in terms of how consumers buy or interact — when we restarted our flights on May 25, 2020, there was a mandate that everyone has to do web check-in and everyone had to face minimal human interaction. That was a big change because at least for Vistara I can say that the proportion of web check-in was much lower before. This will continue for a while, probably forever because people are used to this now and there is a convenience for people in checking in at home. At the same time, people want to have more self help, which is also something we’re trying to do. The second point is in terms of flying behaviour. Pre-Covid, people used to fly on long-haul flights transiting via Middle East to go to Europe. And while this may not be permanent, in the foreseeable future people may not want to transit in multiple points and would want to go direct from point A to B. Our international flights to London, Frankfurt and Paris have been subscribed pretty well and I think there is some truth to that as well.

With the benefit of hindsight, could things have been done in a better way while resuming domestic flights last year?

At that time, it was totally an unknown. There was no vaccine present and no one knew what the next day would bring. Despite all of this, a decision was taken and certain measures were put in place to make sure that there was not too much of spreading or an incident, and this was commendable — the fact that within a few weeks, we were able to come up with the SOPs and we were able to implement it. Of course we were rushing and it was crazy for a few days before the resumption. With hindsight, was there something that could have been managed better? I think, definitely yes, perhaps we could have had more time. But at that time, everything was uncertain.

Now that Covid is receding to some extent, is Vistara looking to get back to its growth plans?

Of course, we scaled back to an extent compared to what we would have otherwise done because of Covid. On the other hand, if you look at it from the point of view of the fleet size and routes and so on, ultimately we have still grown compared to where we were at the time of Covid. In the last six to eight months, we have grown in size from 40 to 48 aircraft. The challenge has always been what is plausible in the face of various restrictions, especially on the international side because of factors such as bilateral arrangements, the second wave, various health measures being put in place. Looking at tomorrow, now that the limitations are being reviewed and restrictions are slowly being removed, it is an opportunity for us to grow and expand further and we will get there as soon as we have the opportunity to do so.

Government has allowed airlines to deploy 100% of pre-Covid capacity on domestic routes but fare restrictions still remain. How do you plan with such a scenario?

Rather than saying 100% capacity, I would say it’s unconstrained because it is left to the airline to decide whether they want to go back to pre-Covid or go more than pre-Covid or reduce because each airline has its own business plans and way to address it. But taking Vistara as an example, pre-pandemic we had around 200 domestic flights a day and now we are doing around 185-190 on certain days. In the month of November, we hope to go back to slightly more than pre-Covid. We are very clear that fundamentally the Indian market can take more capacity because these are the peak periods. I don’t see fare restrictions as a very onerous condition but with flexibility it would be easier for us to price.

At a company level for Tata SIA Airlines Ltd (parent company of Vistara), is there a change in thought process now that Air India is to become a part of the Tata Group?

At this time, we, as Vistara have our own growth plans and our own business plans and strategies, and at this time we will continue to grow as per plan and as per the support of our shareholders as well. So I don’t think it is right to speculate or comment on that but at this time, we are continuing to take delivery of aircraft and continuing to grow.

For Vistara, how important is the race to command a significant market share?

Market share is capacity driven. The market share that you get is going to be related to a certain extent to how many seats you deploy. From our perspective, our market share has been growing consistently since second wave. Pre-covid, we were 5-6%, and it has increased to 8.7% now. Market share is important but at the same time, I cannot expect to have over 50% market share like IndiGo with only 50 aircraft. But on the routes that matter to us, where the profile of the traveler matches our product proposition, we will try to make sure that we are competitive and as close to the customer as possible to ensure that on these routes, our market share remains quite significant.

There are two airlines coming up. One is an ultra low-cost carrier (Akasa) and second is probably a full-service carrier (Jet Airways 2.0). Which one seems more threatening for Vistara?

We will have to compete with both of them. There is no running away. If you look at the Indian aviation market, almost 80% of the market share is dominated by low-cost carriers. This has an implication on pricing and how we can position ourselves. Regardless of whether it is one or the other, the most important thing is what value we bring to the table.

📣 The Indian Express is now on Telegram. Click here to join our channel (@indianexpress) and stay updated with the latest headlines

For all the latest Business News, download Indian Express App.

  • Newsguard
  • The Indian Express website has been rated GREEN for its credibility and trustworthiness by Newsguard, a global service that rates news sources for their journalistic standards.
  • Newsguard