New aviation policy soon

THE HINDU,10JUN2015

The Central Government expects to finalise the long pending new aviation policy and also the much debated revised international flying norms for domestic carriers within a month, according to a senior Civil Aviation Ministry official.

Industry is keenly looking forward for both the policies, amid increasing traffic and competition from both domestic and foreign players.

Airports privatisation

There will be no rolling back on the decision to privatise airports, he added.

“We are almost close to finalising the two policies and would be ready in a month,” the senior official said.

There has been much debate about doing away with the ‘5/20’ norms, which allows only those carriers having been in operation for at least five years and with a fleet of at least 20 aircraft to fly on international routes.

The Federation of Indian Airlines, which has IndiGo, Spicejet, Jet Airways and GoAir as its members, has opposed the move for any relaxation in the 5/20 norm, while Vistara and AirAsia India have been strongly in favour of doing away with the rule.

The senior official said the Ministry would look at having some more discussions on the subject, before relaxing the norms.

No plans for rollback

On the privatisation, the official said there are no plans to roll back the decision.

Airports Authority had recently extended the deadline for submitting bids for control of four State-run airports in Kolkata, Chennai, Ahmedabad and Jaipur to July 1.

Air India shelves plan to acquire Boeing 787-9 aircraft

THE HINDU,03JUN2015

National carrier Air India has shelved its plan to acquire five Boeing 787-9, the higher range variant of Boeing Dreamliner (787-800) aircraft, after failing to secure the nod of its Board and would stick to the original model.

Air India currently has 20 Dreamliners in its fleet. The carrier had signed a deal with the American aircraft maker Boeing Co in 2005 to acquire 68 planes, of which 27 are the Boeing 787-800s. The rest 41 are Boeing 777s (23) and 737-800 (18).

Of the remaining seven planes, which are to be delivered to the Air India by mid-2016, the carrier had late last year proposed to replace five of them with Boeing 787-9.

“Air India had put across its proposal to acquire five Boeing 787-9 in lieu of Boeing 787-800s to its Board recently. But the board did not accept it (the proposal),” an official source said.

The airline was looking at inducting the higher range variant of the aircraft, which has more seating capacity than the existing model for its ultra long-haul routes such as the US and Canada.

The Boeing 787-800 has 256 seats, of which 18 are in business class and remaining 238 in economy class.

Currently, these aircraft caters to Air India’s European and some Asian routes besides servicing some domestic destinations.

Government had early last month said that Air India was evaluating switching its order for Dreamliner aircraft from Boeing 787-8 to the larger version 787-9.

Model substitution rights are available for Air India under the purchase agreement for the B787-8 aircraft signed by it with Boeing.

The national carrier has set up a committee, comprising representatives from finance, commercial, engineering and strategy & planning departments, to evaluate the option to exercise the model substitution rights, Minister of State for Civil Aviation Mahesh Sharma had said.

Boeing had provided four interior layout options for the B787-9 in two class (executive + economy) configuration, Sharma had said.

Jet Airways sacks 50 expat pilots

THE HINDU,01JUN2015

JetAirways has a total of 1,120 pilots, after termination of the service contracts of these 50 expats, Jet Airways now has 88 foreign pilots.

Jet Airways has handed over pink slips to 50 of its expat pilots by prematurely terminating their contracts, bringing their number to 88, as part of its cost—cutting measures as well as reducing dependency on the high-cost overseas flight crew.

“We have prematurely terminated the service contracts of 50 expatriate pilots between April 1, 2014 and March 31, 2015,” Jet Airways acting Chief Financial Officer (CFO) Ravichandran Narayan said during a post-earnings analysts call.

Narayan said as part of the contract obligations, the airlines paid retrenchment compensation to the sacked pilots.

The Naresh Goyal-promoted airline has a total of 1,120 pilots, after termination of the service contracts of these 50 expats, Jet Airways now has 88 foreign pilots.

The country’s civil aviation regulator, Directorate General of Civil Aviation (DGCA), has also given the airlines a deadline of December 2016 to phase out the expatriate pilots.

Narayan, while speaking about the measures taken by airline to contain cost, said Jet Airways has taken several steps particularly in the areas like sales and distribution, engineering and maintenance in this regard.

“We are continuously improving our aircraft utilisation by adding more red-eye flights and early hour departures in our schedule,” he said.

A red-eye flight departs late at night and arrives early next morning. Because of their very low priced tickets, these flights are quite popular abroad, especially in the US and Europe.

Narayan also said the airline was in the process of restructuring its overseas hub at Abu Dhabi by re-assigning some of the flights and withdrawing a few.

“We are restructuring our Abu Dhabi gateway by converting Goa-Abu Dhabi-Goa flight into seasonal one and cancelling the Abu Dhabi-Kuwait and Abu Dhabi-Dammam services,” he said, adding the airline has also decided to reduce the frequency from three daily flights to two on Mumbai-Bangkok route from July 15.

We continue to rationalise our route network in line with the industry condition and traffic evolution, he added.

Meanwhile, Jet Airways on Monday announced a limited period offer of discount of up to 30 per cent on base fares on its premier and economy-class tickets for travel beyond September 14.

ATF price hiked by 7.5%; non-subsidised LPG by Rs 10.50

THE HINDU,01JUN2015

Jet fuel price was hiked by a steep 7.5 per cent on Monday and rates of non-subsidised cooking gas (LPG) by Rs 10.50 per cylinder in step with global firming of rates.

Price of aviation turbine fuel (ATF), or jet fuel, in Delhi was raised by Rs 3,744.08 per kilolitre (kl), or 7.54 per cent, to Rs 53,353.92, oil companies announced on Monday.

On May 1, ATF price was hiked by a marginal Rs 272 per kl or 0.5 per cent to Rs 49,609.84.

Following global trends, the price of non-subsidised or market-priced domestic cooking gas (LPG) was hiked to Rs 626.50 per 14.2-kg cylinder in Delhi from Rs 616 till Sunday.

The price hike comes on the back of a Rs 5 per 14.2-kg cut in rates effected from May 1.

Non-domestic LPG, which consumers buy after exhausting their quota of 12 bottles of 14.2-kg each at subsidised rates, will cost Rs 626.50 as against Rs 616 per 14.2-kg cylinder.

Households are entitled to 12 cylinders of 14.2-kg each or 34 bottles of 5-kg each at subsidised rates of Rs 417 or Rs 155, respectively in Delhi. Any requirement beyond this has to be bought at the market price.

While the market priced or non-subsidised 14.2-kg cylinder will cost Rs 626.50 from June 01, the in 5-kg pack will cost Rs 318.50.

Following similar trends, rates of market-priced 19 kg LPG cylinder has been hiked to Rs 1,151 per bottle from Rs 1,134.

Rates vary from state-to-state depending on the incidence of local sales tax or VAT.

Jet fuel constitutes over 40 per cent of an airline’s operating costs and the price cut will reduce the financial burden on cash-strapped carriers.

No immediate comment was available from airlines on the impact of the price hike on passenger fares.

State-owned fuel retailers, Indian Oil Corp (IOC), Bharat Petroleum Corp (BPCL) and Hindustan Petroleum Corp (HPCL) revise jet fuel and non-subsidised LPG prices on the first of every month based on average imported cost and rupee-dollar exchange rate. The same on petrol and diesel is done on a fortnightly basis.

SpiceJet plans to raise Rs. 300 crore, increase fleet size

THE HINDU,21MAY2015

Budget carrier SpiceJet on Thursday said it will infuse Rs. 300 crore into the airline through various instruments and enhance its fleet size to 45-50 aircraft by March next year.

The decision to raise an additional Rs. 300 crore was taken by the airline’s board that met in Chennai on Thursday, the company said.

The airline’s Board of Directors has also appointed new majority shareholder Ajay Singh and his wife Shiwani Singh as directors and Harsha Vardhana Singh as Independent Director.

Mr. Singh, a co-founder of SpiceJet who exited the airline in 2010, took back its control after acquiring the entire 58.46 per cent stake of Kalanithi Maran and Kal Airways Pvt. Ltd in February as part of a revival plan.

As part of the plan, approved by the Civil Aviation Ministry, Mr. Singh has committed an investment of Rs. 1,500 crore in the carrier, of which he has already infused Rs. 500 crore in February immediately after taking over its ownership.

“The board also took on record company’s efforts to increase its fleet size to 45-50 aircraft by March 2016,” the statement said.

The airline currently has 35 planes — 20 Boeing 737s and 15 Bombardier Q400 — in its fleet.

Air India’s Nagpur MRO ready for commercial operation

THE HINDU,15MAY2015

Air India’s Maintenance Repair and Overhaul (MRO) facility at Nagpur is almost ready to commence operation and according to officials it will be operational by next month.

A one of its kind in India, the MRO facility has capability to carry out major aircraft related jobs on wide body and narrow body aircraft belonging to Indian and international carriers.

“The facility is complete. Tooling is ready and we are only awaiting Directorate General of Civil Aviation (DGCA) certification which should come in the coming weeks. We will start with wide-body aircraft (Boeing 777) checks, followed by Boeing 787 and then narrow body aircraft (Boeing 737),” said a senior Air India official.

AI evaluating option to switch order for larger Dreamliner

THE HINDU,25MAY2015

Air India is evaluating switching its order for Dreamliner aircraft from Boeing 787-8 to the larger version 787-9.

It has already taken delivery of 20 B787-8 aircraft out of the order placed for 27 such planes and the option of model substitution is being considered for some of the remaining ones that are yet to be delivered.

The national carrier has set up a senior committee, comprising representatives from Finance, Commercial, Engineering and Strategy & Planning departments, to evaluate the option to exercise the model substitution rights, the government informed the Rajya Sabha on Tuesday.

In a written reply, Minister of State for Civil Aviation Mahesh Sharma said the carrier has the option of substituting B787-8 aircraft with B787-9.

Boeing has provided four interior layout options for the B787-9 in two class (executive + economy) configuration and these are “24+270=294, 24+274=298, 18+286=304 and 18+292=320”, Mr.Sharma said.

“The B787-8 aircraft in the Air India fleet have an 18+238=256 seats configuration. In addition to the higher seating capacity, the B787-9 also offers 18.9 tonnes of cargo capacity compared to 15 tonnes for the B787-8,” he said.

Out of the order placed for 27 B787-8 aircraft, Air India has so far taken delivery of 20 such aircraft.

“The delivery of 21st B787-8 is expected by the end of June 2015,” Mr. Sharma said.

Model substitution rights is available for Air India under the purchase agreement for the B787-8 aircraft signed by it with Boeing.

In another written reply, the Minister said that recently a Mumbai-bound Air India flight with over 250 people on board was forced to return to Newark.

“On flight AI-144 operating on Mumbai-Newark sector with Boeing 777-300 ER aircraft, the right hand engine experienced vibrations which crossed the normal levels. Hence, the pilot returned to Newark after fuel jettison.

“On inspection conducted on landing, one fan blade of the engine was found damaged,” he noted.