Air Sahara plans major fleet expansion

Friday, 18 October 2002, 19:30 IST
Printer Print Email Email
NEW DELHI: Air Sahara, India's third-largest domestic airline, is set to more than double the size of its fleet by the year-end to link more destinations and grab a larger slice of the domestic aviation industry pie. The privately owned airline, part of the Lucknow-based diversified Sahara group that also has major interests in financing and media, has decided to acquire 12 aircrafts in a multi-million dollar deal this year. "We are getting into a massive expansion mode. We are planning to have 22 aircraft by the end of the current year, up from 10 aircraft now," Uttam Kumar Bose, chief executive officer of Air Sahara, told IANS in an interview. Currently, the airline has a fleet of 10 aircraft - mostly Boeing 737s - that mainly connect its main hub New Delhi to the country's financial capital Mumbai, Kolkata and Chennai. Bose said of the 12 new aircraft, eight would be the smaller 56-seater CRJ-200 that costs $18-20 million each. The remaining would be 150-seater planes. "We are talking to both Boeing and Airbus Industrie for the 150-seaters. We have also lined up financial institutions to finance the acquisitions." The Air Sahara official said the airline would use the smaller CRJ aircraft to significantly increase its destinations by entering feeder routes that are now served by rivals Indian Airlines and Jet Airways. "We are going to introduce flights on routes where there is very less air connectivity at the moment. We will also introduce direct flights connecting smaller towns with metro cities." Industry observers say Air Sahara's decision to expand the fleet to link new destinations in the prevailing uncertain times in air travel industry is a bold move to increase its share in the $1.4 billion domestic aviation market. Air Sahara's market share in September rose over 10 percent, up from 4.6 percent in January, claimed Bose. He said the airline would grab 20 percent of the market by end of the current fiscal year on March 31. The September 11 terror attacks on U.S., a global economic meltdown and threat of a war between nuclear-capable India and Pakistan had crimped the growth in the Indian aviation industry. Bose, however, said the load factor of domestic airlines had improved significantly in recent months following the innovative marketing plans launched by companies to woo the vast Indian middle class. "The new marketing schemes have really worked. Around 12 to 14 percent of total seats are booked under these schemes every day. And as a result we have seen tremendous increase in load factor," he said. Industry official say domestic air travel has picked up in the last two weeks, with airlines reporting higher passenger load factors and bookings. The travel industry expects business to be 20 percent higher during the coming months as compared to August-September period. Domestic airlines say bookings have picked up 5-10 percent since October 1 over the previous month's figures. Air Sahara has rolled out a series of marketing offers to woo customers. "Our target customers are holiday travellers and people who mostly travel by trains." Bose said Air Sahara has won a good response to its Sixer and Super Sixer schemes under which buyers get tickets at substantially lower prices. The airline was also the first to auction seats via the Internet. Under the scheme, it sets a reserve price of 2,999 for seats auctioned on the busy New Delhi-Mumbai route. This is half the normal fare, and just 500 more than the cost of an air-conditioned sleeper berth on a train. "The various schemes have helped create a new generation of air travelers. The response is tremendous," said Bose. Air Sahara aims to boost revenue for the year to March 31, 2003 to 7.50 billion, up from around 3 billion the past year.
Source: IANS
siliconindia