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GoAir plans to remain profitable through capacity expansion

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Airline will strengthen in existing markets before adding new destinations

After stunted growth for some time, Go Air, the low cost of the Wadia group, is planning to expand operations as the becomes clearer. The airline, which will add three by August-end,  will add new frequencies in the ongoing summer schedule. The will, however, not open any new destinations and focus on increasing capacity in existing markets instead.

“Currently, the places we fly to account for almost 85 per cent of the total domestic market. So, basically what we want to do is connect these cities with higher frequencies. That’s what our route planning will mirror in the near future,” said Go Air CEO Wolfgang-Prock-Scahuer in an interview with Business Standard. At present, Go Air, has a fleet strength of 24 aircrafts and flies to 23 airports.


The is adding a third non-stop return flight on the  Kolkata-Pune, Bengaluru-Pune, Delhi-Ahmedabad routes, while deploying a fifth non-stop flight between Delhi-Patna. It will increase its frequency on the Delhi-Leh sector through a fourth non-stop return flight and add a seventh non-stop return flight on the Delhi-Lucknow sector. Overall, the will operate 205 daily this summer, which is 20 per cent higher than the previous year.


“The Kolkata-Pune flight is a good example. We already had two non-stop but felt that there was enough demand to add capacity; we want to become strong in these 23 markets. So you will see addition of frequencies in these markets and then we will venture into new destinations,” said Prock-Schauer.


Go Air’s route planning resembles that of market leader IndiGo, which has been adding capacity relentlessly in existing routesm helping it increase its market share. At present, IndiGo flies to 44 destinations with a fleet strength of 133 planes, while rival SpiceJet covers four destinations with a fleet of 49 aircrafts.


The faced difficulties in its expansion plan as delivery of was delayed due to a snag in the engine of the A320 neo. Go Air had placed order for 144 in two tranches, out of which it has received only five so far. 


According to Prock-Scahuer, the will add 14 aircrafts in the current financial year, increasif its fleet size to 38 aircrafts including 19 neo- “Due to engine issues, we are a couple of months behind our for A320 neo However, in the second half of the year, it will lead to normalisation of our original plan. We are quite confident of the measures taken by the manufacturer to rectify faults. Hopefully, after it becomes normal we can pick up according to our original plan of expansion,” he said.


The engine issue has also forced the to delay its international expansion plans, which were supposed to take off last winter. According to compmany sources, Go Air will focus on middle-east destinations like its domestic rivals and is likely to start its international foray with a Kochi-Doha flight in November.


The airline’s IPO plans also got delayed due to the issue of postponed delivery but the idea has not been cancelled all together, assured Prock-Scahuer.


Profitability for Go Air has not been a problem as it has managed to remain in the black for the last three fiscals. In FY16, it clocked a profit of around Rs 166 crore, according to aviation consulting firm CAPA. Meanwhile during 2014-15, the company reported a profit of Rs 218 crore on an operating revenue of Rs 3,066 crore.


According to the airline, has bettered its performance in FY17 but declined from disclosing figures as approval from the board remains pending.

GoAir plans to remain profitable through capacity expansion

Airline will strengthen in existing markets before adding new destinations

Airline will strengthen in existing markets before adding new destinations

After stunted growth for some time, Go Air, the low cost of the Wadia group, is planning to expand operations as the becomes clearer. The airline, which will add three by August-end,  will add new frequencies in the ongoing summer schedule. The will, however, not open any new destinations and focus on increasing capacity in existing markets instead.

“Currently, the places we fly to account for almost 85 per cent of the total domestic market. So, basically what we want to do is connect these cities with higher frequencies. That’s what our route planning will mirror in the near future,” said Go Air CEO Wolfgang-Prock-Scahuer in an interview with Business Standard. At present, Go Air, has a fleet strength of 24 aircrafts and flies to 23 airports.


The is adding a third non-stop return flight on the  Kolkata-Pune, Bengaluru-Pune, Delhi-Ahmedabad routes, while deploying a fifth non-stop flight between Delhi-Patna. It will increase its frequency on the Delhi-Leh sector through a fourth non-stop return flight and add a seventh non-stop return flight on the Delhi-Lucknow sector. Overall, the will operate 205 daily this summer, which is 20 per cent higher than the previous year.


“The Kolkata-Pune flight is a good example. We already had two non-stop but felt that there was enough demand to add capacity; we want to become strong in these 23 markets. So you will see addition of frequencies in these markets and then we will venture into new destinations,” said Prock-Schauer.


Go Air’s route planning resembles that of market leader IndiGo, which has been adding capacity relentlessly in existing routesm helping it increase its market share. At present, IndiGo flies to 44 destinations with a fleet strength of 133 planes, while rival SpiceJet covers four destinations with a fleet of 49 aircrafts.


The faced difficulties in its expansion plan as delivery of was delayed due to a snag in the engine of the A320 neo. Go Air had placed order for 144 in two tranches, out of which it has received only five so far. 


According to Prock-Scahuer, the will add 14 aircrafts in the current financial year, increasif its fleet size to 38 aircrafts including 19 neo- “Due to engine issues, we are a couple of months behind our for A320 neo However, in the second half of the year, it will lead to normalisation of our original plan. We are quite confident of the measures taken by the manufacturer to rectify faults. Hopefully, after it becomes normal we can pick up according to our original plan of expansion,” he said.


The engine issue has also forced the to delay its international expansion plans, which were supposed to take off last winter. According to compmany sources, Go Air will focus on middle-east destinations like its domestic rivals and is likely to start its international foray with a Kochi-Doha flight in November.


The airline’s IPO plans also got delayed due to the issue of postponed delivery but the idea has not been cancelled all together, assured Prock-Scahuer.


Profitability for Go Air has not been a problem as it has managed to remain in the black for the last three fiscals. In FY16, it clocked a profit of around Rs 166 crore, according to aviation consulting firm CAPA. Meanwhile during 2014-15, the company reported a profit of Rs 218 crore on an operating revenue of Rs 3,066 crore.


According to the airline, has bettered its performance in FY17 but declined from disclosing figures as approval from the board remains pending.

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Arindam Majumder

Business Standard

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