Mumbai: AirAsia India will get a cost advantage over other airline
start-ups. For, it can rely on its parent for aircraft lease,
maintenance support and training.
Even so, its aim of achieving break-even in six to 12 months is difficult, say experts.
Initially the airline was aiming to achieve a break-even in four months; recently, it pushed back the target. The head of investor relations of AirAsia Malaysia, the parent company, said it was not possible for the Indian subsidiary to reach break-even before eight months. And, the group chief executive officer, Tony Fernandes, said the break-even would be achieved in a year.
AirAsia India has a single Airbus A320 and operates six flights between Bangalore and Chennai and Bangalore and Goa. It has announced a Bangalore-Kochi flight from Sunday.
AirAsia Malaysia has among the lowest unit costs (cost involved in flying a seat over a kilometre) in the world and has invested in programmes to reduce it further. This includes a programme with GE Aviation, aimed to help in saving $20 million in five years. However, operating costs in India are high and AirAsia will not enjoy the cost advantage it gets in its Southeast Asia market.
Read news in full 21/07/14 Aneesh Phadnis/Business Standard
Even so, its aim of achieving break-even in six to 12 months is difficult, say experts.
Initially the airline was aiming to achieve a break-even in four months; recently, it pushed back the target. The head of investor relations of AirAsia Malaysia, the parent company, said it was not possible for the Indian subsidiary to reach break-even before eight months. And, the group chief executive officer, Tony Fernandes, said the break-even would be achieved in a year.
AirAsia India has a single Airbus A320 and operates six flights between Bangalore and Chennai and Bangalore and Goa. It has announced a Bangalore-Kochi flight from Sunday.
AirAsia Malaysia has among the lowest unit costs (cost involved in flying a seat over a kilometre) in the world and has invested in programmes to reduce it further. This includes a programme with GE Aviation, aimed to help in saving $20 million in five years. However, operating costs in India are high and AirAsia will not enjoy the cost advantage it gets in its Southeast Asia market.
Read news in full 21/07/14 Aneesh Phadnis/Business Standard
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