expanding outsourcing—especially to overseas
locations, rationalizing the number of aircraft
types and configurations, developing its fleet of
small aircraft and expanding the use of IT to simplify the business process. Management has been
unified and slimmed down, resulting in a 30%
reduction in board members and executive officer
positions with their salaries cut by 20%-35%.
The Indian carrier took to the skies in 1993
and now operates 271 daily flights offering
33,500 seats. Its major bases are Delhi,
Chennai, Calcutta, Bangalore and Mumbai
with a total of 42 domestic and five international destinations.
Under CEO Wolfgang Prock-Schauer, Jet has
had a dramatic financial turnaround in the past
two years and launched a successful IPO this year.
In FY04 it is estimated to have obtained around a
46% share of the domestic air travel market,
becoming India’s largest domestic airline. It flew
more than 6. 9 million passengers in the last fiscal
year and posted a profit of $40.8 million.
The carrier launched daily flights to Singapore
on April 14 and Kuala Lumpur on May 5. Flights
to London commenced on May 23 with an A340-
300 leased from South African Airways and flights
to New York via Brussels are starting around
mid-year. The carrier has 43 737s and a staff of
just 6,512 or 151 per aircraft.
Qantas’s Singapore-based low-cost joint ven-
ture has slowed its fleet growth plans as it
struggles to secure traffic rights on key
routes. In April it asked ILFC to find another
airline to take its fifth A320, which was due
to enter service by May, and is reviewing
delivery of the additional three on order.
The 49% Qantas-owned carrier in December
commenced services with four 180-seat A320s
on routes between Singapore and Hong Kong,
Taipei and Pattaya. However, slow sales forced
the withdrawal from daily flights to Pattaya. It
is seeking rights to Shanghai, Jakarta, Surabaya,
Manila, Kolkata and Hanoi but analysts suggest
that the Singapore government may be holding
a gun to Qantas’s head over its objections to
access by Singapore Airlines to Australia-US
routes. Jetstar’s other partner is government-
owned Temasek Holdings, the major stake-
holder in SIA.
Established in 2004, the Indian carrier
began operations last May with service to 14
cities. It takes its name from its owner
United Brewery’s Kingfisher beer. The airline
is taking delivery of 14 A320s through the
end of 2006 and options are held for a further 20, all with 180 seats.
Kingfisher has modeled itself on JetBlue
Airways and lured former JetBlue Director-West
Coast Operations Alex Wilcox to be president and
COO. Wilcox is upbeat on the airline’s future,
saying, “There is a lot of water to be drunk from
Indian wells.” He believes there will be 200 million Indians flying within 10 years compared to
the current 13 million.
Kingfisher is introducing a host of firsts to
Indian skies including IFE, six different methods
of distribution, real-time engine and airframe
condition reporting, self-check kiosks and central
dispatch for flight planning and crew scheduling.
The airline’s orders in the past 12 months
for 10 787-8s and five A380s capped a stellar year in which it moved from strength to
strength. The orders are part of a commitment to its vision of becoming one of the
world’s Top 10 carriers by 2010. During the
next decade, it will invest a total of $10 billion in new aircraft, inflight service upgrades
and IT enhancements.
The only low note has been sky-high fuel
costs, which resulted in a 70% fall in quarterly
profits to $52.6 million for the period to March
31 on an increase in sales of 2.5% to $1.7 billion. Robust traffic into China and Japan saw
international sales rise 7.8%. Korean projects
that 2005 revenues will top $7.8 billion.
The airline is well into a fleet restructure, with
MD-80s and F100s already gone and MD-11Fs
due to leave shortly. Next to go will be 10
A300B4s. Route expansion is focused on China
and the US; China traffic is 10% of the total.
Indonesia’s second-largest carrier and
largest private airline launched new international services to South Korea and planned to
add Australia in June. Lion Air, which started
operations in June 2000, began its Korean
operations with a flight from Jakarta to Seoul
via Denpasar and Manila. It also commenced
service between Jakarta and Pusan, again via
Denpasar and Manila. Both are five times
weekly. The airline, which has a large
domestic operation with 50 routes, also
serves Singapore, Vietnam, Kuala Lumpur and
China with a fleet of MD-80s and 737-400s.
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