Is Air India ready for B787? ask MPs

Air India should make sure that it has the crew and the bookings for the flights that the Boeing 787 will operate before the first aircraft arrives later this year.

This was the opinion of various members at the first meeting of the Consultative Committee attached with Ministry of Civil Aviation.

Coming down heavily on the airline management, former Civil Aviation Minister and member of the consultative committee, Mr Rajiv Pratap Rudy, demanded that the present the Air India Chairman and Managing Director, Mr Arvind Jadav, be relieved from his duty immediately.

He along with other MPs demanded an investigation to find out the factors responsible for the current mess in the national carrier.

Air India has debt of about Rs 46,000 crore, while the accumulated losses have crossed Rs 20,000 crore. In terms of market share, Air India has fallen to fifth place.

According to Mr Rudy, Air India is likely to receive the first B787 in October, two in November, while the fourth one is expected to arrive in December. There has been a delay of almost three years in the delivery of the aircraft.

Mr Rudy claimed that while he raised the issue of cabin crew availability and booking for routes to be operated by the B787, he did not get any answers.

He apprehended that if preliminary works have not been done, then the cash-strapped carrier might have to ground newly acquired aircraft.

If this were to be happen it would not be the first time in the airline’s history that new aircraft have been grounded. Some years ago, the airline had to ground its new Boeing 777 as it did not have enough crew to operate flights.

Other MPs wanted to know why Air India was losing money on routes on which private airlines were making money.

Is Air India ready for B787? ask MPs - www.infoinhand.com

Indian superjumbo ban hurts Emirates’ A380 growth?

Rules aimed at protecting state-owned Air India bar Emirates from flying the A380 into India

Emirates Airline celebrated the opening of the new terminal at the New Delhi airport last year by flying in an Airbus SAS A380.

The plane has not returned since. India’s government has not acted on requests to change regulations that bar overseas carriers, including Emirates and Deutsche Lufthansa AG, from flying aircraft bigger than the Boeing Co. 747 into the country. That rules out the A380.

The two airlines are eager to tap India’s growing travel market with the A380, the world’s biggest passenger aircraft. They have run up against policies that protect state-owned Air India Ltd., according to Rishikesha Krishnan, a professor of corporate strategy at the Indian Institute of Management in Bangalore.

“All these measures are to shore up Air India and they completely distort the market,” said Krishnan, who writes papers about India’s aviation industry. “They are all misguided restrictive practices and not in the best interest of Indian aviation.”

The rules deny more choices for passengers and reduce competition for Air India, Krishnan said. The carrier merged with state-owned Indian Airlines in 2007 and has received 20 billion rupees ($449m) of public funds since April 1, 2009.

Nasim Zaidi, secretary at the Ministry of Civil Aviation, declined to comment when asked if the government was delaying A380 approvals to help Air India. An Air India spokesman declined to comment, and Air India Chairman Arvind Jadhav did not respond to two calls to his mobile phone, calls to his office and emailed questions.

The A380 offers a “significant cost advantage to airlines, allowing them to price tickets cheaper,” said Amber Dubey, a Gurgaon, India-based director at auditing and consulting company KPMG. “That’s the reason some Indian carriers are concerned.”

Lufthansa, which flies to seven destinations in India with 52 weekly flights, is ready to operate the A380 to New Delhi as soon as India allows the service, the airline said in an email response to questions.

Emirates, owner of the world’s largest fleet of A380s, anticipates strong demand for the superjumbo in the country, Tim Clark, president of the airline, said in an interview.

“We want to take the A380 to India. It would be hugely popular,” Clark said. “Our expansion plans depend on the Indian government -- they make the call on whether we can increase our frequencies.”

The A380 can seat 525 people in a typical three-class configuration, while a similar Boeing 747 can fly 416 people. The A380 has a wingspan of 262ft and stands almost 80ft tall from the ground to the top of its tail.

Airports across India, including New Delhi’s, have undergone renovation and runway extensions to accommodate the A380, said V.P. Agrawal, chairman of the state-run Airports Authority of India. Delhi’s airport added three gates -- 15, 17 and 19 -- specifically meant for the plane.

“Delhi and Hyderabad airports are built exactly to the requirement of an A380,” Agrawal told Bloomberg July 14. “A380 operations from Delhi were not permitted. I’m not sure why, but maybe others see a threat.”

Airports in Mumbai, the southern city of Chennai and Kolkata in the east can also handle the plane, Agrawal said. Kingfisher Airlines Ltd., the only Indian carrier to have ordered the A380, will start taking the plane in 2016, Chairman Vijay Mallya said June 6.

Allowing Emirates to fly the A380 into India would intensify competition for Air India on routes to the Gulf, which are among its most lucrative, said P.C.K. Ravindran, chairman of Kochi-based Institute of Applied Aviation Management.

“So long as Air India is a state property, the government will have to take care of its interest,” said Ravindran, who advises on air projects and has written a book about India’s regulatory framework. “Air India is not just competing with Emirates -- it is fighting for room with Etihad, Air Arabia and RAK Airways, and let’s not forget Indian carriers flying to the Gulf.”

Flights to the Gulf region, where 2.2 million Indians migrated for work between 2007 and 2009, accounted for 49 percent of Air India’s overseas services, according to the Civil Aviation Ministry’s annual report for the year ended in March.

Air India has about 53 weekly flights to Dubai, mostly using Airbus 321 jets that can seat 172 people. Its low-fare unit Air India Express operates 54 weekly flights, Chief Operating Officer S. Chandrakumar told Bloomberg by text message on July 12.

The company also has more immediate problems. It may receive 17 billion rupees from the government to help the carrier pay salaries and maintain services, according to a company official familiar with the matter. Air India is seeking as much as 175 billion rupees from the government to help reduce debt and pay for planes on order after posting four years of annual loss. The airline is working on a financial restructuring plan to pare debt of 400 billion rupees as of March.

As of April last year, Indian carriers were eligible to sell 711,356 seats per week on flights to and from 104 countries. They utilized only 170,914 seats a week, compared with 326,705 seats by overseas airlines, official data showed.

Air India’s struggles have come as foreign airlines nearly doubled service to and from India in 2010 compared with six years ago, according to data from the Civil Aviation Ministry. Boeing expects a market of 1,320 new passenger planes in India over the next 20 years.

Indian superjumbo ban hurts Emirates’ A380 growth? - infoinhand.com

Chandigarh to get India’s first Centre for Excellance - www.daily.bhaskar.com

Chandigarh: In a bid to provide better training for the unemployed youth in the country, the government has taken a new initiative.

Chandigarh is set to get the first Centre of Excellence in the country that will provide vocational training to drop out students. The central government began the initiative keeping in view the fact that around eighty eight per cent of students across India do not go for higher education.

The centres are being opened up in collaboration with educational institutions and interested parties from the job industry. The Chandigarh centre will b opened at Rayat Bahra, Punjab Info-tech and Industries.

Chairman of the group Gurvinder Singh Bahra told reporters on Thursday that there is good scope for students in automobile, hospitality, IT, hydro and aviation industry. Bahra also said the problem is that the students are not imparted the education that would prepare them for the industry. It is only because of this that the number of unemployed youth is rising by the day.

Singh also said at least forty prominent companies from the automotive sector will open their centres at the new centre for excellence. He further said the syllabi will be prepared for everyone from Class VIII drop outs to graduation drop outs.

The duration of the courses will vary from three months to three years and the forty companies will also provide opportunities of job for the students at the centre.

The courses will be certified by Punjab Info-tech. Punjab Minister for Industries Tikshan Sood will inaugurate the centre on July 23. Chief Secretary of Ministry for Technical Education Suresh Kumar and several CEOs of the companies participating in the project will also be present at the inauguration.

Chandigarh to get India’s first Centre for Excellance - www.daily.bhaskar.com

SpiceJet to tie up with global low-fare carriers

Mumbai: SpiceJet Ltd, India’s second largest low-fare airline controlled by media baron Kalanithi Maran of Sun TV Network Ltd, is exploring a different flight path for the second phase of its international expansion.

It is also talking to two airports in south India and one in Gujarat to set up its second regional base, after Hyderabad.

Currently flying two international routes—Colombo and Kathmandu—SpiceJet has applied for 10 more, including South-East Asia, West Asia and some destinations in the Commonwealth of Independent States. Its rival and India’s largest low-fare airline IndiGo has got permission to fly some key international routes—Dubai, Singapore and Bangkok.

“We will not be just a point-to-point carrier. We will create partnerships with other international low-fare carriers. They will sell our products and we will sell their products,” Spicejet’s chief executive Neil Mills said in an interview.

SpiceJet’s flights will feed into other international carriers and vice versa. Mills did not divulge details of international carriers the airline is negotiating with.

Leading low-fare carriers flying to India include Air Asia, Air Arabia and Tiger Airways.

According to Nawal Taneja, professor emeritus, department of aviation, 

Ohio State University, on almost every continent, there are similar instances of low-fare carriers tying up with each other.

As a majority of the low-fare carriers use Navitaire software for their reservation systems, it will be easy for SpiceJet to work with others, Mills said.

Unlike its rivals, SpiceJet is targeting non-traditional international routes that can be supplemented by alliances with international low-fare carriers.

According to Mahantesh Sabarad, a senior analyst with domestic brokerage Fortune Equity Brokers (India) Ltd, SpiceJet has no options but to opt for such arrangements, which are technically not code-share agreements but much like those in spirit.

Sabarad, who tracks SpiceJet stock, said these arrangements will widen the reach of the airline.

He cited some examples of low-fare carriers partnering with full-service ones to boost traffic. German low-fare carrier Air Berlin has not only entered into a code-share agreement with American Airlines, but has also decided to join a global grouping of international airlines—the oneworld alliance.

Spain’s Vueling Airlines is working with Iberia Airlines and British Airways.

Even as it talks to international low-fare carriers, SpiceJet is preparing to launch flights to smaller cities with 15 Q400 Bombardier planes, which are smaller than the Airbus 320 and Boeing 737 that form the mainstay of domestic fleet.

“We are talking to two airports in south India and one airport in Gujarat for a second base for these operations,” Mills said. The airline has already selected Hyderabad as the base for its regional operations.

It has delayed its plans to fly to smaller cities with smaller planes as its proposal to raise $270 million is yet to be cleared by the Reserve Bank of India (RBI).

“We are late by three to four weeks,” said Mills. He denied that finance agency Export Development Canada, from which SpiceJet is getting $270 million, has raised concerns over investigations related to 

Dayanidhi Maran, Kalanithi Maran’s brother, and actions he may have taken when he was telecom minister.

“Export Development Canada has given us an unconditional offer. We will be starting operations once RBI gives us permission,” he said.

SpiceJet will face tough competition from Jet Airways (India) Ltd and Kingfisher Airlines Ltd, which are also strengthening operations in secondary cities with smaller planes.

Increases in the price of jet fuel can derail SpiceJet’s plans, according to analyst Vikram Suryavanshi at domestic brokerage Antique Stock Broking Ltd. The company is especially susceptible when oil trades at more than $90 a barrel.

SpiceJet shares dropped 0.42% to R

s.35.85 on the Bombay Stock Exchange on Thursday. The benchmark Sensex fell 0.36% to 18,436.19 points.

SpiceJet to tie up with global low-fare carriers - Corporate News - livemint.com

Companies may no longer need government approval to purchase aircraft

NEW DELHI The civil aviation ministry is considering doing away with the government approval needed for aircraft purchases, a move experts say will help airlines speed-up fleet expansion in a market growing at 20% a year.


India's aviation sector was opened to private players several years ago, but aircraft procurement still needs government clearance.


An airline planning to buy aircraft can enter into a memorandum of understanding (MoU) with a manufacturer, but it must take the aviation ministry's in-principle approval before placing the order.


"We are reconsidering the requirement for this approval, as an aircraft order is purely a commercial agreement between two parties and companies should be free to do so. We should arrive at a decision by next month," a senior civil aviation ministry official said.


Removing the administrative barrier would shorten the time needed for getting aircraft into the country and put Indian carriers on a par with international players, said an airline's CEO, who did not want to be named. "No other country, to my knowledge, requires airlines to seek such an approval.


Sometimes, aircraft manufacturers become uncomfortable when we tell them that we are keen on a deal, but wait, we need to go back and take a government approval," the executive said. The issue of in-principle approval surfaced with reference to recent reports that low-cost airline GoAir's aircraft order had hit regulatory hurdles, as it was placed without the ministry's approval.


The airline did not respond to an email query on the status of its order. Sector experts and airline executives say doing away with the required approval would give a fillip to the Indian airline industry, which is forecast to need 1,500 aircraft over the next two decades.


Airlines have to pay a signing amount for the MoU and the balance payment is made at the time of aircraft delivery. Sometimes, the in-principle government approval also helps facilitate financing arrangements, done in foreign currency, with banks and funding institutions.


Sector experts think it is a ripe time to do away with the requirement, as demand for air travel in the country is growing in double digits. Last year, Indian carriers flew about 60 million passengers, which is expected to grow to 362 million by 2021.


"Indian carriers have learnt from the mistakes of 2007 and are more prudent now in their fleet expansion plans. It should be left to the maturity of these players and market forces to decide the timing and quantum of aircrafts purchases," said Amber Dubey, director (aviation) at global consultancy firm KPMG .

Companies may no longer need government approval to purchase aircraft - The Economic Times

Empire Aviation Group

Steve Hartley, executive director of private aviation specialist Empire Aviation Group, talks to Jayne Alverca about the company’s approach to maximizing asset value and the flight experience in the Middle East and beyond.

Based in Dubai, Empire Aviation Group stands apart as the operator and manager of the Middle East’s largest fleet of corporate and private jets. As well as aircraft sales, the company provides aircraft charter and management services with a focus on high quality luxury and corporate travel throughout the Middle East and the rest of the world.

Executive director Steve Hartley is very clear about the company’s mission. “The purchase of an aircraft, whether for private or corporate purposes, represents a very significant investment. Our entire operation is geared towards managing and maximizing the value of that asset on behalf of our clients in the most professional and efficient way possible,” he states.

Managing the aircraft asset properly ensures that its value is protected, leveraged and maintained during the years of ownership. “Historically, aircraft have either maintained their original purchase price or in some cases even appreciated in value but without the effective management we provide, this would not be the case. We can also help customers to charter their aircraft and so offset some of the costs of ownership,” he explains.

For this reason, he is clear that despite Empire Aviation’s wealth of experience, owning as opposed to operating and managing a fleet could never be an option. “If we had our own aircraft we would inevitably be competing with our customers as charter requests would naturally be directed to our own aircraft first,” he adds.

“For similar reasons we do not offer a direct maintenance service, although we do have an extremely skilled division of maintenance engineers who measure cost against quality control and oversee all maintenance contracts. If we were to offer that service directly, customers could never be certain that they were getting value for money whereas with our third party arrangement, they know we will search out the best supplier. As it stands we can use our expertise to save our customers a great deal of money. For example, Jet Aviation is a preferred supplier, but for the benefit of owners, we also work with a number of other maintenance providers and we regularly put maintenance contracts out to tender.”

Hartley sees the company’s reputation for fairness and sound business ethics as the cornerstone of its success. “Something that sets us apart in this business is that we operate a completely transparent cost structure. Of course, we exist to make a profit, but it has to be a fair profit and we are very happy for all our customers to have access to this information. Transparency is critical to us. Our aim is to create a win-win situation for everyone, but it is imperative that our customers understand we will always treat them fairly.”

All aircraft meet the extensive safety, training, and inspection requirements required by the General Civil Aviation Authority of the United Arab Emirates, but this is merely a starting point. The Empire Aviation business model stresses providing customers with an unsurpassed travel experience, whether it be in terms of security, comfort, flight personnel or catering.

Pilots and crew undergo a rigorous recruitment process—all training is directly supervised by Empire Aviation—and no detail is spared in the search for an incomparable service proposition. For example, an agreement has just been signed to become the first operator in the Middle East of the Vigiplane security system—a completely new concept in aircraft security. The system comprises five day and night cameras in a special composite sealed container which provides high quality pictures and infrared projectors. It is unique, because it is completely independent from the aircraft’s own systems and thus requires no special aircraft certification.

Another agreement that breaks new ground has been reached with global catering services provider Private Flight Global to restructure the catering management operations for the entire fleet. A specially customized version of Private Flight’s online system enables flight personnel to offer the highest level of personalized service with the flexibility to create tailored menus, track customer preferences and ensure a faster response to VIP requests. As well as enhancing the customer experience, the partnership will give Empire Aviation better oversight and control of the catering function, greater cost efficiency and more streamlined administration.

For customers whose requirements centre predominantly on pleasure, the luxury travel division of the company takes the service proposition even further. Empire Aviation has now joined forces with Taj Hotels Resorts & Palaces, one of Asia’s most exclusive luxury hotel groups, to create a special portfolio of travel packages, all of which include a private jet.

So far, the business model has worked extremely well in Dubai. Hartley points out that since its inception, the company has typically grown its revenues by a heady 100 per cent per annum. “We are very proud of our achievements to date. Even last year which was one of the worst in aviation history, we still managed to increase turnover by 25 per cent,” he adds.

Empire Aviation is now in readiness to replicate its model further afield. “We are already working with Indian customers operating out of Dubai, so it is a logical extension of those relationships to establish a direct presence in India. In August 2011 we will open our first branch in Mumbai. There is tremendous growth potential in India and Asia generally, but no professional management companies,” he says. Empire Aviation is also considering other geographical options in the Far East but he is reluctant to be drawn on details, as these plans are still at an early stage.

While Hartley sees the composition of the fleet evolving in line with the growing acceptance of aircraft ownership as a business tool, he is adamant that the basic formula with its focus on transparent financial procedures will not change. “There is an old adage that stresses: stick to what you know you do well. We want to preserve all the benefits to customers that we can offer as a wholly independent management company with no possible conflicts of interest. Our model is well received and respected and we have nothing to gain from competing with our customers.” www.empire.aero

Empire Aviation Group | Business Excellence Magazine

Government sounds air alert after US warning on aviation assets

The Central government has sounded an alert at airports across the country after intelligence inputs warned of a possible terror attack against aviation assets. Though the Bureau of Civil Aviation and Security first received an alert a couple of days ago, intelligence agencies on Thursday reiterated the warning, prompting a security beef-up at key airports, including the Indira Gandhi International Airport in New Delhi and Mumbai's Chattrapati Shivaji International Airport.


According to the latest intelligence alert, aviation assets could be targeted by terrorist elements in the immediate future. The alert follows a warning from American agencies that terrorist groups might surgically implant a bomb into human beings and place them on direct flights to the US.


"This is new intelligence about a possible technique that could be used...however there is nothing to indicate an imminent threat," a senior US security official was quoted as saying. The US based Transportation Security Administration had recently briefed air carriers and foreign partners to provide greater insights into recent intelligence indicating the continued interest of terrorists to target aviation, its spokesman Kawika Riley told the US media.


"The idea that terrorists have been looking for other ways to circumvent security measures in order to target aircraft is not at all surprising," White House press secretary Jay Carney told mediapersons in Washington. The heightened communications and activities by the US, it is learnt, are in response to a potential threat, but there is no specific information about an imminent threat coming from a particular area.


"Such a threat is likely to come from overseas rather than domestically, but precautionary steps are being taken internationally and in the US," the official said. It is understood that all countries including India with airports that have lastpoint-of-departure flights to the US have been alerted with the latest intelligence input gathered by the US, which continues to be the prime target of terrorists across the world, especially those based in Pakistan and Afghanistan. Since the Mumbai and Delhi airports have flights having last-point-of-departure to the US, it is logical that tightened security might be experienced by passengers at these two Indian airports as a result of the latest terror alert.

Government sounds air alert after US warning on aviation assets - The Economic Times