Airlines go for small aircraft to reduce operating costs

NEW DELHI: With the high cost of aviation fuel threatening their existence, domestic airlines are preferring smaller and fuel-efficient aircraft to reduce their operating costs. Major carriers���Kingfisher, Air India and Jet Airways���have pruned their orders for the bigger 150-to-350-seater Boeing and Airbus aircraft while maintaining their orders for 102 smaller ATR (50 to 74 seater) aircraft to be delivered in the next four years.

Even as fuel costs have dipped over the last couple of months, aviation fuel prices in India is still the highest in the world, primarily due to taxes. Fuel costs forms around 40% of the airlines��� operating costs. The bigger aircraft, which normally connect metros and bigger cities, consumes 30-40% more fuel than ATR.

Indian carriers have cancelled deliveries of their wide-bodied aircraft like Airbus 340 and postponed the narrow-bodied Boeing 737 and the Airbus 320 family. More than 50 orders have either been cancelled or postponed by different Indian airlines.

Kingfisher Airlines, with 65 aircraft, has the largest confirmed orders for ATRs in India. A company executive said: ���The operating costs of an ATR is 50% less than a typical jet aircraft like A320. It���s more practical to expand our network on these aircraft, which are more efficient and save critical cost expenses. So, we are looking at expanding on regional routes with cheaper-to-operate ATR aircraft.���

Europe-based ATR spokesperson David Vargas said: ���All our deliveries are on schedule and all Indian carriers��� inductions are on time. We have one of the largest orders from the Indian market. We have increased our production to 64 ATRs per year from 44 last year and aim to reach 75 machines next year to meet demand.���

Despite the current slowdown, the company plans to sell 300 ATRs in the next few years. It will also be taking commercial orders for its new aircraft ATR-600, currently under testing.

The aircraft will be available in 2011 and will be marketed in India from next year. ATR is also setting up its second pilot training centre in India to meet the needs of its growing fleet.