Air India plans to connect New Delhi with international routes this year

NEW DELHI: Air India, India's national airline, is keen to open new destinations to Indian fliers this year as it prepares to face renewed competition from rival Jet Airways' international ambitions, especially in the backdrop of an impending deal with Etihad Airways.
Air India plans to connect New Delhi to new international cities like Birmingham, Moscow, Rome, Milan, Melbourne and Sydney this year, arguing that if new destinations are not opened up, Indian traffic would get funneled to Abu Dhabi or Dubai airports for onward connections.
Pointing the flip-side to the government's policy of allowing foreign carriers to buy 49 per cent stake in Indian airlines, AI CMD Rohit Nandan said that if the government doesn't penetrate new destinations, demand for "sixth freedom" or ferrying Indian passengers onwards from hub airports like Dubai and Singapore will automatically increase. Sixth freedom traffic rights refer to the right of any foreign airline to carry passengers or cargo from India to a third country via their own country.
"Foreign airlines are not coming to India to invest. The government has to watch carefully that for them FDI doesn't become merely a way to increase their share of bilateral rights. If Indian carriers don't invest in new destinations, over-capacity on certain routes will force passengers to use foreign airlines to go to destinations of their choice," Nandan told ET.
Till date Gulf airlines like Emirates, Etihad and Qatar, which are gateway carriers, dominate air routes between India and the Middle East to an extent that 40 per cent of total international Indian traffic is routed through the Gulf.
Most Indian carriers prefer to fly on some stock routes instead of trying new destinations and Air India plans to change its strategy as it prepares to face more intense competition from Middle Eastern and South East Asian carriers.
After Kingfisher AirlinesBSE 4.11 % lost its international slots, Jet AirwaysBSE -3.43 % on March 20 asked for permissions to operate more flights to Abu Dhabi, Dubai, Singapore, Hong Kong and Kuwait, among others.
In that context, Nandan's fear to lose more Indian passengers to Gulf carriers, especially with the deal between Jet Airways and Etihad, is becoming real. Explaining the scenario as to what would happen with foreign carriers buying into Indian airlines becomes a reality, he said other airlines should work to counter new competition.
http://economictimes.indiatimes.com/news/news-by-industry/transportation/airlines-/-aviation/air-india-plans-to-connect-new-delhi-with-international-routes-this-year/articleshow/19485942.cms

Etisalat's misfortune casts shadow over Etihad's Jet deal

ABU DHABI: Etihad Airways' purchase of a stake in Jet AirwaysBSE -3.48 % could be delayed until at least August as the Abu Dhabi carrier seeks assurances following setbacks for several Gulf investors in India, two sources familiar with the talks said. Etihad, which is expanding globally, has been in talks over an equity stake in Jet since September after India relaxed ownership rules and allowed foreign airlines to buy up to 49 per cent in local carriers.
The Gulf airline is eyeing a 24 per cent stake, valued at $330 million, according to sources aware of the matter.
The deal, which would inject much-needed funds into Jet and help Etihad expand its reach into the vast Indian aviation market, has slowed over concerns of past failed forays by Gulf investors into India and the Abu Dhabi firm's demands to protect its potential investment, the sources said, speaking on condition of anonymity as the matter is not public. "It's going to take some time; at least until August," said one source, who is aware of the discussions
http://economictimes.indiatimes.com/news/news-by-industry/transportation/airlines-/-aviation/etisalats-misfortune-casts-shadow-over-etihads-jet-deal/articleshow/19486031.cms
 

Kingfisher Airlines seeks renewal of flying permit

NEW DELHI: Having lost airport slots and most of its aircraft fleet to its creditors in the last six months of being grounded, Kingfisher AirlinesBSE 4.11 % on Wednesday asked aviation regulator DGCA to renew its flying permit, which expired last year.
Sanjay Aggarwal, the CEO of KingfisherBSE 4.11 % Airlines, submitted a fifth revival plan to Directorate General of Civil Aviation (DGCA) chief Arun Mishra early evening, so that the carrier could start operations with seven planes to begin with.
"We have given the complete funding and traffic plan to the DGCA. The initial funding to restart the airline will be organised from the UB Group. We have also requested the DGCA to renew our flying licence," Aggarwal said after meeting Mishra.
While DGCA sources said it was not possible to take a call immediately on whether Kingfisher's licence should be renewed since the revival plan needed thorough examination, the only difference was that its parent company UB Group had secured approval from shareholders to fund the airline.
"Though the proposal is more practical this time with Kingfisher having secured no-objection certificate from private airports and maintenance and repair (MRO) companies, the dues of Airports Authority of India (AAI) are still not cleared nor are those of the service tax department," regulatory sources said.
Kingfisher Airlines has requested AAI to let it fly on a cash-and-carry basis, the source said, adding that they plan to raise money as they start to fly, for which they need their licence to be renewed. "They need to secure no-objection certificate from the AAI and lenders still."
http://economictimes.indiatimes.com/news/news-by-industry/transportation/airlines-/-aviation/kingfisher-airlines-seeks-renewal-of-flying-permit/articleshow/19485908.cms
 

Jet Airways shares fall on worries Etihad stake sale may be delayed

MUMBAI: Shares of Jet Airways IndiaBSE -3.40 % Ltd dropped as much as 5.8 percent on Thursday after Reuters reported a stake sale to Abu Dhabi's Etihad Airways could be delayed until at least August, two dealers said.
The delay could come as Etihad is seeking assurances following setbacks for several Gulf investors in India, two sources familiar with the talks said.
Jet shares were down 3.2 per cent as of 0400 GMT.
http://economictimes.indiatimes.com/markets/stocks/stocks/in/news/Jet-Airways-shares-fall-on-worries-Etihad-stake-sale-may-be-delayed/articleshow/19488693.cms

AirAsia India to lower fares, but at a price

NEW DELHI: It's the ultimate irony. While travellers are waiting for really low fares from AirAsia India, Indian carriers are waiting for it to begin operations so that they can increase their ancillary revenue by charging more for things like check-in baggage.
 Indian carriers have been planning to reduce the current domestic free check-in baggage allowance of 20 kg to 15 kg. But the only reason they have not done this so far is the fear of being asked to reverse the move by the Directorate General of Civil Aviation (DGCA). The aviation regulator had asked airlines to stop charging extra for pre-selection of seats last year.
 "AirAsia does not offer any free check-in luggage and passengers have the option of booking the same at the time of buying tickets. They are likely to get the same policy to India, enabling us to at least lower the current free checkin weight from 20 kg to at least 15 kg," said an airline official.
 The official of another airline said, "Once big names like Tata Sons and AirAsia have a JV airline flying here, the mandarins of aviation ministry and the offices they control will not be able to interfere too much. Airlines will hopefully be able to get some more operational freedom."
 For instance, airlines point out, charging for pre-selection of seats is a common global practice but that is not allowed in India.
 LCCs, which now fly almost 75% of all domestic travellers , say they are looking at unbundling services so that the basic cost of flying from origin to destination is low but a passenger is required to pay for anything else.
 "Today, even the full-service Air India is contemplating charging for meals while giving only snacks and peanuts free. Airlines need to generate revenue and given the condition of Indian airlines — with all of them struggling to survive except IndiGo — any revenue stream has to be considered seriously," said an airline official.
 Higher billing
 Domestic carriers may cut free check-in luggage limit to 15kg from 20kg if AirAsia brings its fee model to India They also want to charge again for pre-selection of seats after DGCA scrapped the move the firsttime round Full-service carrier Air India is already considering charging for meals and giving only snacks and peanuts free
http://timesofindia.indiatimes.com/business/india-business/AirAsia-India-to-lower-fares-but-at-a-price/articleshow/19470355.cms

KFA Submits Revival Plan to DGCA, Seeks Nod to Fly Again

After remaining grounded for over six months, Kingfisher Airlines today sought regulatory approvals to relaunch its operations and submitted plans to the DGCA on infusion of funds and revival of its flights.
 "We have shared the funding and traffic plans. The initial funding to restart the airline will come from the (parent UB) Group. We have also requested that our (flying) licence be renewed," the airline's CEO Sanjay Aggarwal told reporters after meeting DGCA chief Arun Mishra here.
Sources in the Directorate General of Civil Aviation said they would examine the plan thoroughly before taking a call.
 Kingfisher's flying licence or the Scheduled Operator's Permit (SOP) was suspended in October and later lapsed in December after the airline was grounded following a strike by its employees, including pilots, over non-payment of dues.
 The meeting came months after DGCA sought written commitment from the promoters of the airline that additional funds will be infused by the parent company.
According to the plan submitted today, Kingfisher would resume limited operations with five Airbus A-320 and two turboprop ATR aircraft and gradually step up its operations by increasing the number of planes to 20.
 Though Aggarwal did not say by when he planned to relaunch the flights, the sources said Kingfisher cannot resume operations before Winter Schedule starting October.
Aggarwal also claimed that Kingfisher has "everything required to restart the airline" and said "we have submitted the NOCs (no objection certificates) also", but did not clarify which of its vendors had given the NOCs.
 The sources said while Kingfisher had obtained NOC from private airport operators, it was yet to get NOCs from the Airports Authority of India, tax authorities and banks.
 "They (Kingfisher) want to go ahead and therefore have requested for renewal of their SOP so that further action can be taken to restart the airline," a source said.
 Terming the latest revival plan as "more practical", the sources said Kingfisher has offered to pay the staff their salary dues till January. "The airline wants its licence to be renewed so that it can raise money after resuming operations."
 Agarwal told DGCA that the airline planned to start the operations immediately after renewal of its SOP and try to repair other planes once the operations start. On funding of the beleaguered carrier, the airline CEO said the UB Group has secured the permission of the shareholders to put funds in the airlines, the sources said. The cash-strapped airline has also requested the AAI to allow them to fly on cash-and-carry basis.
 Kingfisher top-brass, including promoter Vijay Mallya, have held several meetings with DGCA and Civil Aviation Ministry officials over the past few months to try and convince them to allow the airline to fly again.
 The Ministry officials had then made it clear that they were not satisfied by Kingfisher's plans, which entailed infusion of Rs 650 crore by the parent company, as it may not guarantee efficient and reliable services.
 Earlier this month, the airline paid salary dues of two months to its employees who have not been paid for past 10 months, after DGCA warned that its licence would not be renewed till it cleared dues of its staffers and all vendors.
A consortium of banks have lent over Rs 7,500 crore to the now defunct airline and has been refusing to lend any more money to it till the promoters infuse more funds.
 Kingfisher owes an estimated Rs 13,582 crore to banks, its staff, airport operators and oil companies. It reported a net loss of Rs 755.17 crore for the third quarter ending December 31, a period in which it did not operate a single flight.
 To recover their money, the banks' consortium, led by the SBI, have started selling shares of the parent company, United Spirits, pledged with them. They have already sold around 7.3 lakh of the 26 lakh shares.
http://news.outlookindia.com/items.aspx?artid=795022

Seeks DGCA nod to resume ops

Kingfisher Airlines’ Chief Executive Officer Sanjay Aggarwal met Director General of Civil Aviation (DGCA) Arun Mishra on Wednesday, seeking permission to resume the airline’s operations with UB Group funding.
 After the meeting, Aggarwal told reporters, “We have submitted the entire revival plan to the DGCA. The financial plan remains the same. Initial funding will be done by the UB Group.” The airline plans to restart operations with five planes, he added.
 However, according to top government sources, chances of the airline’s revival appear slim with lessors seizing the aircraft and lenders selling pledged shares.
 The airline’s operations have been grounded since October last year and its operating permit, too, has been suspended.A few months ago, Aggarwal had submitted a plan for “limited resumption” of the carrier’s operations, with funding of Rs 652 crore from the UB Group over 12 months, as banks were unwilling to extend further credit.
 According to this plan, the airline was to start operations on a “cash-and-carry basis” (paying airport operators and oil companies on a per take-off basis) and planned to use  the Rs 652-crore funding for payment of salary dues, refurbishment of planes and daily operating losses.
 At that time, the airline had said that it would begin operations with five Airbus and two ATR turbo-prop aircraft. Later, the fleet could be scaled up to 11 ATRs and 10 Airbus planes, the airline had said.
 However, the plan failed to pass the test with both Mishra and Civil Aviation Minister Ajit Singh saying it was not credible enough.
 Recently, the civil aviation regulator de-registered 17 Kingfisher aircraft following a Delhi high court order. Also, there were reports that many of these planes are stripped of engines and spare parts, raising doubts about their air worthiness
http://www.business-standard.com/article/companies/kfa-seeks-regulatory-nod-from-dgca-to-relaunch-ops-113041000355_1.html
 

Jet-Etihad deal to get delayed

Abu Dhabi: Etihad Airways’ purchase of a stake in Jet Airways could be delayed until at least August as the Abu Dhabi carrier seeks assurances following setbacks for several Gulf investors in India, two sources familiar with the talks said.
Etihad, which is expanding globally, has been in talks over an equity stake in Jet since September after India relaxed ownership rules and allowed foreign airlines to buy up to 49 per cent in local carriers. The Gulf airline is eyeing a 24 per cent stake, valued at about $330 million, according to sources aware of the matter.
The deal, which would inject much-needed funds into Jet and help Etihad expand its reach into the vast Indian aviation market, has slowed over concerns of past failed forays by Gulf investors into India and the Abu Dhabi firm’s demands to protect its potential investment, the sources said, speaking on condition of anonymity as the matter is not public.
“It’s going to take some time; at least until August,” said one source.
“There are issues relating to what happened to some other UAE entities like Etisalat and Emaar in India. So nothing is going to happen soon.” Etisalat, the UAE’s biggest telecom operator, shut down its Indian mobile operations after a court ordered the revocation of cellular permits including those granted to Etisalat’s local affiliate following a scandal-tainted 2008 sale.
http://www.deccanchronicle.com/130411/news-businesstech/article/jet-etihad-deal-get-delayed