MDLR Airlines Private Ltd, a regional carrier that closed down in 2009, plans to restart operations in six months under the brand name Jet Sapphire, according to a report in the Mint. The Gurgaon-based airline has hired Shakti Lumba, who set up the operations of InterGlobe Aviation Private Ltd-run low-cost carrier IndiGo in 2005 and, before that, Air India Ltd’s regional arm Alliance Air, to head the airline.
“The three aircraft that we have will be used for our flights to start with, and we are also in talks for more aircraft,” Lumba, who quit IndiGo in December 2009, said. With India’s domestic passenger market growing in double digits, several carriers are looking to open regional operations. Low-cost carrier SpiceJet Ltd announced its entry into the regional market with its newly acquired Bombardier Q400 aircraft. GR Gopinath, former Air Deccan chief is launching charter services to connect several airports in Gujarat, while Jet Airways (India) Ltd has said Hyderabad will be a hub for more short-haul flights.
The domestic passenger market, which grew at 18 per cent last year, is expected to outpace capacity addition by airlines this year, consulting firm Centre for Asia Pacific Aviation (Capa) said in its April outlook for 2011. Traffic will grow at 17-18 per cent, and possibly by 20 per cent, it predicted.
Until now, running stand-alone regional operations has not been a successful business in India. There are no exclusively regional airlines operating at present, although national carriers such as Air India, Jet Airways and Kingfisher Airlines do run regional services.
Buoyed by a passenger growth rate of 40 per cent, the aviation ministry had in 2007 introduced the new category for airlines to increase regional connectivity by offering operators separate licences to fly in each of the country’s four regions—north, south, east and west.
The ministry is now thinking of changing the policy, a Ministry of Civil Aviation official said. “There is a thinking that the whole policy needs to be revisited,” the official said. “The scheduled airlines are doing well, so the policy must be right. The same does not seem to be true of regional airlines.”
Aviation regulator Directorate General of Civil Aviation (DGCA) had in March 2011 proposed relaxing norms for start-up regional carriers. Companies can have a fleet of a minimum three aircraft in two years instead of one, and five aircraft in five years instead of three, according to the draft policy published on its website.
Analysts said there are enough passengers now to make regional carriers viable, but infrastructural concerns remain. “I believe our economy has reached the critical mass and is ready for regional airlines, but infrastructure bottlenecks are the culprit,” said Shankar Devarajan, President, Su mitra Inc, a Toronto-based aviation strategy firm. Devarajan added, “SpiceJet and others are not true regionals, they will still be flying from tier-II cities to tier-I cities. True regional is connecting tier-II to tier-II and tier-II to tier-III and so on. That’s not going to become a reality until we have more airports.”
Ernest Arvai, President of the US-based aviation consulting firm Arvai Inc, said regional carriers have not been successful in India due to lack of infrastructure at regional airports, demand for flights to big cities, lack of economic development in smaller cities and higher costs. “If I were to start a regional (airline), I’d try and become a feeder for a carrier with international routes—the local markets themselves may not lend themselves to profitability,”
“The three aircraft that we have will be used for our flights to start with, and we are also in talks for more aircraft,” Lumba, who quit IndiGo in December 2009, said. With India’s domestic passenger market growing in double digits, several carriers are looking to open regional operations. Low-cost carrier SpiceJet Ltd announced its entry into the regional market with its newly acquired Bombardier Q400 aircraft. GR Gopinath, former Air Deccan chief is launching charter services to connect several airports in Gujarat, while Jet Airways (India) Ltd has said Hyderabad will be a hub for more short-haul flights.
The domestic passenger market, which grew at 18 per cent last year, is expected to outpace capacity addition by airlines this year, consulting firm Centre for Asia Pacific Aviation (Capa) said in its April outlook for 2011. Traffic will grow at 17-18 per cent, and possibly by 20 per cent, it predicted.
Until now, running stand-alone regional operations has not been a successful business in India. There are no exclusively regional airlines operating at present, although national carriers such as Air India, Jet Airways and Kingfisher Airlines do run regional services.
Buoyed by a passenger growth rate of 40 per cent, the aviation ministry had in 2007 introduced the new category for airlines to increase regional connectivity by offering operators separate licences to fly in each of the country’s four regions—north, south, east and west.
The ministry is now thinking of changing the policy, a Ministry of Civil Aviation official said. “There is a thinking that the whole policy needs to be revisited,” the official said. “The scheduled airlines are doing well, so the policy must be right. The same does not seem to be true of regional airlines.”
Aviation regulator Directorate General of Civil Aviation (DGCA) had in March 2011 proposed relaxing norms for start-up regional carriers. Companies can have a fleet of a minimum three aircraft in two years instead of one, and five aircraft in five years instead of three, according to the draft policy published on its website.
Analysts said there are enough passengers now to make regional carriers viable, but infrastructural concerns remain. “I believe our economy has reached the critical mass and is ready for regional airlines, but infrastructure bottlenecks are the culprit,” said Shankar Devarajan, President, Su mitra Inc, a Toronto-based aviation strategy firm. Devarajan added, “SpiceJet and others are not true regionals, they will still be flying from tier-II cities to tier-I cities. True regional is connecting tier-II to tier-II and tier-II to tier-III and so on. That’s not going to become a reality until we have more airports.”
Ernest Arvai, President of the US-based aviation consulting firm Arvai Inc, said regional carriers have not been successful in India due to lack of infrastructure at regional airports, demand for flights to big cities, lack of economic development in smaller cities and higher costs. “If I were to start a regional (airline), I’d try and become a feeder for a carrier with international routes—the local markets themselves may not lend themselves to profitability,”
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