SpiceJet to double fleet, increase flights

PANAJI: Low-cost carrier SpiceJet has lined up a major expansion plan. The airline plans to more than double the size of its fleet within the next year, and to increase the number of its daily flights from 48 to 86 by January ’07.

The no-frills carrier, which incurred a net loss of Rs 41 crore in the first quarter of this year, is also targeting a 100% rise in its revenues. Said SpiceJet director Ajay Singh, “We are expecting to increase our overall revenue from Rs 453.15 crore currently to nearly Rs 910 crore by the next financial year.”

The company claims it would make a net profit by next fiscal through expansion in its fleet size, flight operations and reduction in costs. On the cost front, the airline says it has slashed costs by almost 25% after outsourcing its aircraft maintenance and flight safety to Star Navigation Systems.

The airline is likely to connect Delhi with cities like Jaipur, Indore, Guwahati, and Varanasi soon. Said vice-president (marketing and planning), SpiceJet, Sanjay Kumar, “By the beginning of next year, we will be operating a total of 86 flights everyday.

And by the end of ’08 we plan to add 23 new aircraft to our existing fleet of six planes. This will help us operate, more than 250 flights to about 24 destinations."

SpiceJet also plans to jack up its load factor to about 90% in the next two quarters from over 70% currently. According to the Directorate General of Civil Aviation (DGCA) figures for July, SpiceJet has led the industry in terms of load factor.

SpiceJet’s load (seat) factor stood at 78%, followed by Air Deccan, which registered a load factor of 74.2%. These two airlines have been the only two carriers to manage a load factor of over 70% during the lean season, with almost a 10% margin over Jet, the third largest in terms of load factor.

“We already have bookings for the next three months. We are targeting a consistent target of achieving over 90% load factor at least in the peak season,” said Mr Kumar.

However, with over half-a-dozen new airlines expected to start services soon the fight for market share and load factor is likely to intensify. And achieving a 90% load factor may be a tough task for SpiceJet, which has about 7% of the market share currently.