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Air Carnival and Zav Airways are new entrants in Indian airspace!

It appears that Zav Airways plans to enter the Eastern and North Eastern regions to cater to their needs, while Air Carnival will be based in the south

GM Siddeshwara, minister of state for civil aviation told the Parliament that the government has cleared two regional airlines, Air Carnival and Zav Airways, which are expected to launch their services once all other formalities have been completed.

 

Air Carnival and Zav Airways were given approval on 24th and 30th June, respectively. It appears that Zav Airways plans to enter the Eastern and North Eastern regions to cater to their needs, while Air Carnival will be based in the south. More details are expected to be announced in due course.

 

In a recent press conference by Air Asia's top executives, Mittu Chandilya, chief executive, confirmed that, already the Bangalore-Goa sector has turned profitable. They anticipate Air Asia to break even by December this year but this can only be delayed if there are delivery bottlenecks for the aircrafts ordered. Meantime, plans are afoot to launch the next sector, Bangalore-Chennai soon, followed by Bangalore-Cochin on 20th July. They have indicated that they may have to have more than one hub though they are happy starting with Bangalore.

 

In a separate interview, both Ratan Tata and Tony Fernandes have reiterated that Air-Asia and Tata-SIA would not be "competitiors". This only means that, in the long run, possibly they will be able to complement each other in servicing' public needs.

 

Tomorrow, on 10th July, the Delhi High Court is expected to hear the case filed by Federation of Indian Airlines against Air Asia. It may be recalled that Dr Subramanian Swamy had spearheaded the attack and other domestic airlines, most of whom are reported to be operating at a loss with heavy loan burden, are dead against this no-frill low-price customer-friendly airline.

 

Should the verdict goes against Air Asia, they may have to stop the flights or appeal against the same. Both the airline and the passengers expect the verdict to be favourable.

 

Indigo, India's largest domestic airline, have plans to go in for an IPO soon, in the next few months to take care of their financial needs, as reported in the press. Further announcement, on this score, is expected shortly.

 

Other domestic airlines continue to offer cut-throat rates, such as the Rs999 rate for 10 lakh seats announced today by Spicejet for travel between 6th January and 24 October 2015. One wonders what purpose is being solved by such moves? This may keep the flights full but coffers may remain empty without profits. Losses can only mount unless they have devised ways and means to increase profits.

 

Whether the Federation of Indian Airlines welcome both Air Carnival and Zav Airways remains to be seen!

 

(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)

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