 |
| VT-TTB, Vistara first A320-232 aircraft at Delhi Airport |
Vistara, the countries latest full-service carrier is
a joint-venture (51:49) between Tata Group and Singapore Airlines. The airline
had commenced its operation on 9 January 2015. The airline has a robust fleet
expansion program which stands at 9 even before it completes 1 year of
operation. It has a network of 12 destinations and serves 25 routes as of
today. Vistara has so far carried 7.72 Lakh passengers in the first 10 months
and crossed the 1 Lakh monthly passengers mark for the first time in October.
And the airline is expected to cross the milestone of flying the first million
passengers by the end of the year, which is also well within its 1 year of
operation. Here we will discuss how the airline so far performed in terms of
its aircraft utilization and route development and whether it is able to
maintain pace with its fast fleet expansion to have a maximum utilization of
those capacity?
Vistara's current fleet expansion program has
a target of 20 Airbus A320 aircraft by the end of 2018 which corresponds to 4
years of its operation. Out of 20 aircraft 13 will be of A320CEO variant and
the rest 7 will be A320NEO. All 20 aircraft are being sourced brand-new from
Bank of China (BOC) Aviation. Vistara has so far received 9 A320CEO aircraft
and expected to complete its first year of operation at the current fleet level
of 9. The remaining 4 A320CEO is expected to join by the first half of 2016 and
the 7 A320NEO will join through the next 2 years, 4 in 2017 and the final 3 in
2018. Since it was originally expected to commence schedule flight service in
Q4 2014, the airline had to take delivery of its initial aircraft in quick
succession during Q1 2015. By March it had 6 aircraft in its fleet then it
added its 7th aircraft in September, 8th aircraft in October and the latest
addition, its 9th aircraft (MSN:6865) has just arrived in Delhi yesterday and
will be registered as VT-TTJ. Vistara has received its 9th aircraft with its
typical cabin configuration of 16 Business-class, 36 Premium Economy and 96
Economy class seats. Although the airline has signaled earlier to review the
present seating configuration in early 2016 which may reflect in a changed
cabin configuration on its 10th aircraft, VT-TTK, onward.
Currently it has a fleet of 8 active aircraft
and operates 297 weekly flights or only 43 flights a day on weekdays which
further dips to 39 on Sunday. To compare, another airline related to the Tata
Group, operates 40 flights a day with a fleet of just 6 aircraft. With the
arrival of its 9th aircraft Vistara to increase frequency on the busy
Delhi-Mumbai sector from current 6 to 8 (on weekdays) from Dec.15 and to add an
additional 4x weekly (1,5,6,7) flight on Delhi-Goa sector between Dec. 18 and
Jan. 11; After that the added frequency on the Goa route to become weekend only
(6,7), in the meantime Vistara will continue to operate its current daily
flight on the Delhi-Goa sector. The airline is temporarily suspending its
morning frequency on the Delhi-Lucknow sector between Dec. 20 and Jan. 15; The
decision is expected to be influenced by the fact it is the peak fog season
both at Delhi and Lucknow airport. But Vistara is also reducing its evening
frequency on Delhi-Bhubaneswar sector from current daily to 5x weekly between
Dec. 18 and Jan. 11. Although no valid explanation is available behind this
decision. So even with an additional aircraft Vistara's operation is not
expanding significantly as the no. of weekly flights stands at 311 as of 1
January 2016 from current 297;
Route
|
Flight No
|
Departure
|
Arrival
|
Service span
|
DEL-BOM
|
UK997
|
08:25
|
10:40
|
From
Dec. 15
|
UK993
|
13:50
|
16:05
|
From
Dec. 15
|
|
BOM-DEL
|
UK998
|
11:50
|
13:55
|
From
Dec. 15
|
UK996
|
17:15
|
19:25
|
From
Dec. 15
|
|
DEL-GOI
|
UK877
|
13:50
|
16:30
|
1,5,6,7
between Dec. 18 – Jan. 11
|
UK877
|
13:50
|
16:30
|
6,7
from Jan. 16
|
|
GOI-DEL
|
UK878
|
17:10
|
19:55
|
Between
Dec. 18 – Jan. 11
|
UK878
|
17:10
|
19:55
|
6,7
from Jan. 16
|
|
DEL-BBI
|
UK781
|
16:25
|
18:35
|
2,3,4,6,7
between Dec. 18 – Jan.11
|
UK781
|
16:25
|
18:35
|
Daily
till Dec. 17 & from Jan. 12
|
|
BBI-DEL
|
UK762
|
19:20
|
21:25
|
2,3,4,6,7
between Dec. 18 – Jan.11
|
UK762
|
19:20
|
21:25
|
Daily
till Dec. 17 & from Jan. 12
|
|
DEL-LKO
|
UK927
|
07:25
|
08:40
|
Closed
between Dec. 20 – Jan. 15
|
LKO-DEL
|
UK936
|
09:25
|
10:30
|
Closed
between Dec. 20 – Jan. 15
|
The average aircraft utilization of Vistara's
fleet is low compare to its industry peers. Some of its pattern just involves 4
flights a day, for example it operates an aircraft only for the double daily
flights on the Delhi-Bhubaneswar sector a day. Another pattern shows an
aircraft doing the morning Delhi-Mumbai-Delhi rotation then it seats idle
between 12:40 and 17:10 pm before it flies the Delhi-Pune-Delhi rotation, a
total of only 4 flights a day. While other airlines (both FSC & LCCs) in
India operating an aircraft upto 8 flights a day, increasing the average aircraft
utilization. The average aircraft utilization of Vistara's 8 aircraft stands at
10h 34min as of 30 Nov. 2015 while the DEL-HYD-DEL-GAU-IXB-DEL-BOM pattern
showing the best block time of 12h 05min and DEL-BBI-DEL-BBI-DEL pattern
showing block time of only 8h 30min. So there are lot of capacity going
un-utilized in the airline and it is absolutely important for Vistara team to
focus on a route development program which can maximize the utilization of the
added capacity.
 |
| Vistara's route network as of Nov. 2015 |
Vistara had added Varanasi as its latest destinations on Oct. 21
thereafter it had added no new destinations in November and currently there are
no new proposed/announced destination to be included in the network in the
coming weeks. It is expected that Vistara will soon expand its network too to
maintain a balance with its aggressive fleet expansion program. In the past few
weeks Vistara had multiple cabin-crew recruitment drive which signals likely
expansion in its daily operations. Vistara is known to be looking for opening
new short distance CAT-III route from Delhi in the coming months. As of
November, Vistara flies 11.8% capacity on the CAT-II routes compare to
what it deploys on the CAT-I routes. So with increase in CAT-I capacity (added
DEL-BOM frequency from mid-Dec.) the percentage of CAT-II capacity is expected
to go further down, and even breach the minimum 10% criteria mentioned in the
route-dispersal guidelines (RDG). Therefore Vistara may well consider
either increasing frequency on its existing CAT-II routes (DEL-GAU/IXB-DEL) or
opening a new CAT-II route from its Delhi hub and Srinagar can be the ideal
destination to launch during the start of the summer season 2016. Srinagar
is the biggest airport with more than 2 million annual passenger traffic, in
the north of Delhi and Vistara has so far all the routes going down southward
from Delhi. Therefore it would also complement hub-spoke model of the airline.
Although it is known that Vistara is eyeing Chennai and Kolkata by the next
fiscal, both are CAT-I route from its hub Delhi, it can perhaps target Kerala
market with all 3 routes from Delhi being CAT-III, it would suite Vistara's
network best. With relatively longer flight within India Vistara can well
differentiate itself from the competition and there is indeed not much competition
on the non-stop Delhi-Kochi route as only 2 airline operate 4 flight a
day and there is not a single non-stop flight available between Delhi and
the Kerala capital Thiruvananthapuram.
 |
| Vistara's network distribution in comparison to RDG as of Nov. 2015 |
Apart from adding new destinations in the
network the airline also can consider connecting its Tier-II destinations with
Mumbai. Although it serves flights to Delhi, Bangalore and Goa from Mumbai,
Vistara doesn't recognize Mumbai Airport as its secondary (mini) hub not even
as a focus city. In fact it doesn't have a particular aircraft stationed
at Mumbai instead it parks on rotation an aircraft at night to operate the
first morning Mumbai-Delhi flight. As the non-stop air-connectivity between
Varanasi-Mumbai, Bhubaneswar-Mumbai & Lucknow-Mumbai are not so good at
present so the airline can potentially connect those cities. There is a good
demand on the Hyderabad-Mumbai sector as well. The airline should consider
parking another aircraft at Mumbai in the near future to operate a morning
BOM-BLR-DEL-XXX-DEL-BLR-BOM pattern. Or parking the aircraft at Bangalore so
that it can operate an early morning Bangalore-Delhi flight with evening return
which will complement its current morning Delhi-Bangalore and evening return
flight. Vistara being a premium full-service carrier route development is
proving to be a challenging task as there is little demand for its
buisness-class/premium economy class product on most of the routes in India.
And most of the metro to metro sectors it is operating now is already well
served and competition is extremely high. It will be interesting to see how
Vistara proceeds with its route development program amid the constrains of RDG
and the 5/20 rule.
Note:
- 1 Lakh = 1 hundred thousand
= 1,00,000
- The aircraft (VT-TTB)
picture is from Wikipedia Commons.
- The 'Vistara's route
network' picture is a property of the airline, here used for
representative purpose only.
Great read! Your insights are spot on. I appreciate the way you articulate complex ideas in such a clear and engaging manner. Looking forward to more content from you!
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