Millennium Post

SpiceJet focus on profitability, not crazy on mkt share: Singh

Unperturbed by rivals having higher pie of the domestic traffic, SpiceJet on Friday said it would not "go crazy" about market share and the focus is on remaining profitable in a responsible manner.

Scripting a turnaround with seven straight quarters of profit after being on the verge of closure in late 2015, SpiceJet is currently fourth in terms of domestic market share after IndiGo, Jet Airways and Air India. Asserting that SpiceJet would not "go crazy" about its market share, SpiceJet Chairman and Managing Director Ajay Singh said the focus is to grow in a responsible way and remain profitable.

"Market share will happen as we increase our planes and flights," he noted.

As per the latest data available with aviation regulator DGCA, SpiceJet is at the fourth position with a market share of 12.8 per cent, a notch below national carrier Air India which had 12.9 per cent share at the end of November 2016.

During the same period, rival IndiGo's market share touched 42.1 per cent while that of Jet Airways stood at 14.9 per cent, excluding JetLite which had a meagre share of 2.4 per cent.

About ongoing controversy over the On Time Performance (OTP) of domestic airlines which was triggered by rival IndiGo, Singh said he could not understand what it was all about.

Taking a dig at IndiGo, he noted that it is the same data that has been used by that airline saying they are number one for the last several years.

"Now, the same data shows that SpiceJet is number one and has been number one for the last six month. I don't see the reason for the controversy.. It is government data and we are no quoting our data," he said.

In November 2016, SpiceJet clocked the highest OTP of 81.7 per cent while that of IndiGo much lower at 72.4 per cent. The data, compiled by aviation regulator DGCA, is from four metro airports.

DGCA has set up a panel to review the OTP measuring mechanism for airlines following IndiGo complaining that the current system was flawed.

In a lighter vein, Singh said it would be beneficial for consumers when airlines fight over operational punctuality.

"It is great for consumers that people fighting about OTP... Let me try and beat us. We will try to beat them. Let everybody else try to beat us and we will try to beat them. The consumer will benefit from all of this," he added.

SpiceJet mulls low-cost long haul flights 
Looking to spread its wings farther on rising passenger demand, SpiceJet is mulling operating low-cost long haul flights with new aircraft.

After sealing a Rs 1.5-lakh-crore deal with Boeing for buying up to 205 new planes, most of which are 737-MAX ones, the airline would explore new markets as this class of aircraft can fly for longer hours.

SpiceJet Chairman and Managing Director Ajay Singh on Friday said the idea of low-cost long haul flights is "at infancy" and would be explored further provided the business model is workable. Only a handful of airlines, including Singapore-based Scoot and Malaysia's AirAsia X, have attempted flying low-cost long haul flights and some of them have been doing good.

"We would also explore the possibilities of commencing low-cost long haul flights in future. We will study this... we are keeping the option open if we think in the future that we can run economically-viable and profitable operations," he said.

He said the airline is looking at the economics of wide body, low-cost long haul format while the kind of planes that can be used is to be decided. "The narrow body MAX aircraft itself gives us bigger range... So now the four-hour flights can be five-hour flights and that opens up several new destinations to explore," the SpiceJet chief said.

According to him, for Indian market –where there is a large population, increase in disposable income and forecast suggesting higher GDP growth –there is very little reason why people would not want to travel to different parts of the world provided those flights come at a cost which is affordable".

"If you can stimulate that market with lower fares and that stimulation is possible only if you bring down the cost down on a unit basis. If we find that there is a model that works, we will certainly explore it," he said.

At present, SpiceJet has 32 next generation B737s and 17 Bombardier Q400s. It flies to 45 destinations, including six international ones, while average number of daily flights is 336. 
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