Vistara to cross 2 million passengers milestone in June 2016

Vistara, the country's newest full-service carrier has embarked on a growth path in 2016 and after 16 months of operation it has started reflecting in the passenger volumes. By the end of its first year of operation, Vistara had operated around 300 weekly flights in a network of 12 destinations with a fleet of nine Airbus A320-232 aircraft; A major change in Vistara's operation can be seen right from the beginning of the second quarter of 2016 when the airline considerably increases its available seat kilometers (ASKM) by adding new frequencies on existing routes, launching four new destinations even before it adds the 10th aircraft VT-TTK (first in 2016). 

Vistara: Fast fleet expansion, route development lags

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?

What if '5/20' rule goes tomorrow?

VT-TTB, the first A320 aircraft of Vistara at Delhi Airport.

The so called '5/20' rule which restricts Indian airlines with less than 5 years of domestic flying experience and a fleet size of less than 20 from flying on international routes, was introduced in 2004, close to the arrival of low-cost carriers (LCC) in India. It was meant to protect the then incumbent players like Air India, Air Sahara, Jet Airways from the potential competition from new entrants like Air Deccan, Kingfisher Airlines, SpiceJet and others. On October 30, the Ministry of civil aviation (MoCA), the nodal ministry on aviation has released a draft policy called 'National civil aviation policy 2015' (NCAP 2015). And the MoCA is expected to come up with the final aviation policy by the year end. One of the proposals on the draft policy includes revision of '5/20' rule, either partial or complete removal of it. Federation of Indian Airlines (FIA), the lobbying group consisting Jet Airways, SpiceJet, IndiGo and GoAir, is actively opposing any relaxation in the '5/20' rule.

It is time for Delhi Airport to go Big!

Busy immigration area at Terminal 3 of Delhi Airport

Indira Gandhi International Airport or popularly Delhi Airport, India's and indeed South Asia's busiest airport by annual passenger volume, had handled 39.75 million passengers in 2014. Since 2009, it had occupied the position of country's busiest airport replacing Mumbai. And for the year 2014, Delhi Airport was awarded with the title of 'World's Best Airport' in the 25-40 million annual passengers category by the Airport Council International. But it will be challenging for Delhi to defend the title this time. As in 2015 it is going to enter the big club of airports with beyond 40 million annual passenger volume. Currently it is one of the fastest growing major airports in the world, growing at a double digit rate in 2015. In the first two quarters of the current fiscal year (FY2016: Apr'15-Mar'16), Delhi airport has already clocked 22.76 million passengers, an increase of ~15% over the traffic for the same period in the previous year (~15% YoY). And it is expected to cross 46 million passengers by the end of this fiscal. At the current rate of growth (~15% YoY) Delhi airport is likely to cross 60 million annual passengers milestone by FY2018 (see Figure:1). Being optimistic, if the present macro-economic environment persists Delhi Airport to reach its full capacity of 100 million before FY2024. But if you look at the present expansion plans of Delhi international airport limited (DIAL) it seems insufficient.

Vistara to achieve the milestone of one million passengers by 2015 end?

VT-TTB, the first A320 aircraft of Vistara at Delhi Airport.

Vistara, the joint venture airline between Tata group and Singapore Airlines, is the newest full service carrier in India. Starting scheduled flight services on 9 January 2015 the airline had already crossed the milestone of flying 5 lakh* (0.5 million) passengers on 20 August 2015, just over seven months into operations. Now it will be interesting to see whether Vistara can achieve the first one million passengers mark by the end of 2015 or by the first year of its operations. Almost a year back the airline had started with a fleet of only two aircraft and launched operations to only three destinations initially. Then the airline has experienced a rapid growth as it gradually increased its fleet size to eight as of today and almost added a new destination a month into its network. Currently, Vistara serves twelve destinations across India distributed among Tier-I, Tier-II and Tier-III cities as per ministry of civil aviation's (MoCA) route dispersal guidelines. The twelve cities are Delhi, Mumbai, Ahmedabad, Goa, Hyderabad, Guwahati, Bagdogra, Pune, Lucknow, Bangalore, Bhubaneswar and Varanasi in the chronology of those being included into the network.