cruising_heights_june_2011

www.cruisingheights.inJune 2011 n ` 90CRUISING HEIGHTS

Special Issue

HAPPY LANDINGS

AAI CHAIRMAN V P AGRAWAL ON FUTURE PLANS

Swords out in Europe vs Gulf carriers duel

Kiran Grandhi on creating the future

Ground handling: Thenowhere story

MRO: Brighter prospects butobstacles remain

A-Z of the air cargo business

PLUS

aviation outlook

AFTER WEATHERING THE DOWNTURN, THE COUNTRYS CIVIL AVIATION INDUSTRY IS ALL SET TO FLY HIGH, TAKING IN ITS STRIDE THE MAJOR CHALLENGES OF INFRASTRUCTURE AND RISING FUEL PRICES.

outlook cover 2 final_ACI COVER.qxd 6/1/2011 11:39 AM Page 1

EDITOR-IN-CHIEFS NOTE

The great irony ofIndian aviation isthe complexities

that govern the sector.The hotter it got, thebigger it grew and the

larger it expanded, the more complexbecame the regulation mechanism. Andwhile aviation grew at a merry 25-30percent year on year, the framework togovern this crazy growth trajectory didnot grow even at three per cent!

Infact so bad was the situation someyears back that the Federal AviationAuthority warned that it woulddowngrade Indias rating, sending theentire Civil Aviation Ministry into atizzy. The present Secretary and the thenDG of the DGCA, Dr Nasim Zaidi, wasin the thick of it and the regulatorseffort to beef up the directorate beganthen. It is still a work in progress.

By the same yardstick, airports andairlines have to seek over a 100 differentapprovals before they can commenceoperations and, mind you, half of themare from the Ministry of Civil Aviationand its sundry agencies. A consequenceof such a licence raj, if one may put itthat way, is the edifying spectacle of thehusband working for a private airline,and the wife overseeing security for thesame airline in the Bureau of CivilAviation Security (BCAS) that governsthe security infrastructure in India.

Whats happened in the DGCAwhen parents regulated and childrenwent to fly for the airline is too welldocumented to bear repetition. Whilethe officials are all paying a price fortheir subterfuge, there are no questionsbeing asked of the airlines that were soobliging. If corners were being cut,why did they acquiesce in the firstplace? But as one operator put itpithily: If you quarrel with the

umpire, you can be run out!If that is one aspect of the story, HR

is another burning issue. With theMinistry of Civil Aviation moving tolicense Air Traffic Controllers (ATCOs),it is just a matter of time before theyare poached by others in the regionand the larger world. There is plenty ofrespect for their abilities and itsremarkable that this band of men andwomen have given us a relativelyaccident-free sky during all these yearsas aviation grew and grew and thepressure on them became unbearable.

If there are any lessons that we needto learn from all this it is that we need toramp up our human resources. That isgoing to be our greatest challenge in thecoming decade as aviation grows at anannual 15 per cent. It is unbelievablethat the DGCA doesnt have an officialwith sufficient seniority and maturity tobe DG. And each time the post is up forappointment, there is an outsider whogets the top job. It would also help if wecan simplify our regulatory mechanism.

As Ranbir Kapoor says in a differentcontext, keep it simple, silly.

2011 AVIATION OUTLOOK

03JUNE 2011 CRUISING HEIGHTS

K Srinivasan

Keep it simple, silly!

TOUGH JOB: Controllers at ATC room.

Edit.qxd 5/31/2011 4:54 PM Page 3

4 CRUISING HEIGHTS JUNE 2011

AVIATION OUTLOOK 2011

TAKE-OFF TO ABRIGHTER FUTURETHE DOWNTURN ALMOST FORGOTTEN, THE INDIANAVIATION INDUSTRY IS POISED FOR A BIGGER LEAPEVEN AS IT BATTLES INFRASTRUCTURE WOES ANDFUEL PRICE HIKES.

A R T I C L E S N E W S V I E W S E D I T S I N T E R V I E W S C L I P P I N G S P R O F I L E S N E W S D I G E S T

OFF THE CUFFAGE OF THE PALM FLIERSLike most of the developed world,the mobile has started playing amajor role in travel bookings inAsia. Brett Henry, Vice PresidentIndia, Abacus International pointsout that bookings on mobiles in theAsian region finished at a recordhigh in 2010,up 11 per centover theprevious year.Writing in Eyefor Travel,Henry forecaststhat the mobilewill be the nextplatform fortravelmanagement. Indicating that in anemerging market like India,"where penetration of personalcomputers is low, mobile Interneton handsets will be popular choiceamongst consumers due to itsaffordability and portability". Hewrites that "67 per cent oftravellers and 77 per cent offrequent business travellers withInternet-enabled mobile devicesuse the mobile Internet to findlocal services and attractions"while 53 per cent of leisuretravellers indicated that real-timeflight information is their toppreferred mobile feature". This year, 2011, will see travellersresorting to "planned spontaneity"with Apps for mobile-enabledservices changing lives and travelhabits. Air Asia, for example, usespromotional tools to drive its salesvia its mobile services: numerousbookings are done everyday inaddition to seat selection andcheck-ins. Japanese All NipponAirways customers use theirmobiles to make domestic andinternational bookings along withthe usual add-ons like seatselection, etc. In the next few year, mobileservices will enable travellers to bemore productive when it will bringin just-in-time data based on theuser's location.

32

contents

AROUND ASIA56

OUTLOOK

INFRASTRUCTURE52

POLICYWHO WILL WINTHIS ROUND?AKBAR AL BAKER TAKES ON ULRICH SCHULTE-STRATHAUS IN THE BATTLE BETWEENEUROPE AND THE GULF!

22INDIA SETSSTANDARDSAVIATION VETERAN BASHIRAHMAD ON THE HEADYGROWTH OF INDIAN AVIATION

CREATING FORGROWTHV P AGRAWAL, CHAIRMAN,AAI, ON FUTURE PLANS ANDREVENUES

Content new.qxd 5/31/2011 1:59 PM Page 2

Project1_Layout 1 5/30/2011 9:50 AM Page 1



FORECASTCREATING THEFUTUREKIRAN GRANDHI BELIEVESTHAT 100 AIRPORTS WOULDBE NEEDED IN NEXT 10 YEARS

30UPGRADE

TOP OPERATIONMIALS RUNWAYMARATHON FINALLYENDS!

58CARGO

BUSINESS OFAIR CARGOAIR CARGO BUSINESSAROUND THE WORLD HAS ALONG WAY TO GO

86

77

Editor-in-ChiefK SRINIVASAN

Managing EditorTIRTHANKAR GHOSH

Group Consulting EditorR KRISHNAN

Consulting EditorNANDU MANJESHWAR

Deputy EditorPC SINGH

Special Correspondent (Mumbai)ROOHI AHMAD

Copy EditorASHOK KUMAR

Editorial CoordinatorLAKSHMI SINGH

Sub-editor-cum-reporterPUNIT MISHRA

DesignRUCHI SINHA, MOHIT KANSAL, SHIV

Picture EditorPRADEEP CHANDRA

Photo EditorHC TIWARIPublishing DirectorROHIT GOEL

Director (Admin & Corporate Affairs)RAJIV SINGH

Asst. Manager (Subscription)JAYA SINGH(Mob. 9650433044)

Executive DirectorRENU MITTAL

For advertising and sales enquiries,please contact:+91-9999919071, 9810030533

EEddiittoorriiaall && MMaarrkkeettiinngg ooffffiiccee::Newsline Publications Pvt. Ltd., D-11 Basement, Nizamuddin (East), New Delhi -110 013 Tel: +91-11-41033381-82All information in CRUISING HEIGHTS isderived from sources we considerreliable. It is passed on to our readerswithout any responsibility on our part.Opinions/views expressed by third partiesin abstract or in interviews are notnecessarily shared by us. Materialappearing in the magazine cannot bereproduced in whole or in part(s) withoutprior permission. The publisher assumesno responsibility for material lost ordamaged in transit. The publisherreserves the right to refuse, withdraw orotherwise deal with all advertisementswithout explanation. All advertisementsmust comply with the IndianAdvertisements Code. The publisher willnot be liable for any loss caused by anydelay in publication, error or failure ofadvertisement to appear. Owned andpublished by K Srinivasan 4C Pocket-IV,Mayur Vihar Phase- I, Delhi-91 and printedby him at Nutech Photolithographers, B-240, Okhla Industrial Area, Phase- I, NewDelhi-110020.

CRUISING HEIGHTSVolume VI No 2

COVER PHOTO: H C TIWARICOVER DESIGN: RUCHI SINHA

CONTENTS

US AVIATION SECRETS UNVEILEDTHE ABBOTOBAD OPERATION BY THE US NAVY SEALS BROUGHT BEFORE THE WORLD THE SIKORSKYBLACK HAWK STEALTH MACHINE THAT FLOATS LIKE A BUTTERFLY AND STINGS LIKE A BEE

CHOPPER SPECIAL

BACKPAGENOT A CAR ORA PLANEDEBUTING THIS YEAR, THENEW TRANSITION ROAD-ABLE AIRCRAFT IS BOTHROLLED INTO ONE

114NEWS

Q4 RESULTSARE MIXEDTOUGH TIMES ARE AHEADAS NATURE AND OIL PLAYHAVOC.

10

HIGH ONCARGO BIZBLUE DART, JET AND KALECONSULTANTS CONTINUETHEIR GOOD RUN

100

GREAT TIMESCONTINUEJET AND KINGFISHER UNVEILENTICING OFFERS FOR PAS-SENGERS AND MUCH MORE

104

PHO

TO C

OU

RTES

Y: a

viat

ionw

eek.

com

Content new.qxd 6/1/2011 2:43 PM Page 4

We are a PAN India operating; ISO 9001:2008 certied company, specializing in design, engineering, fabrication and installation of Curtain

Walls, Doors & Windows and cladding work for exterior & interiorsapplications for all types of projects.

Our three production plants located in Chennai, Mumbai &Gurgaon deliver products as per your requirements and

specications, with our Star Alubuild assurance that theproduct will meet your standards of Quality in Time.

Star Alubuild Pvt Ltd has successfully completedsome of the most challenging projects in the coun

try. Many of the best infrastructure Airport projects, Malls, Commercial Complexes, Luxury

Hotels, Corporate Oce Complexes, andMultistoried Residential Complexes bear

the Star Alubuild Stamp.

The Terminal 3 of Indira Gandhi International Airport (IGIA) which

was conferred the 4th Best Airport award in the world (in

the 1525 million category)and Best Improved Air

port in the AsiaPacicRegion by the Airport

Council Internationalmeant 35,000 Sq.

Mtrs. of Glazing and Corian Cladding work for Star

Alubuild Pvt Ltd. in form ofan Engineering, procurement

and construction contract (EPCContract).

The challenge before us was not onlyconverting the square RCC columns into

an octagonal Corian cladding columns aring upwards with a tapered bird mouth but

also using Corian on a scale that has never beenused before. Our expert design and execution

team have shaped them into perfect aring octagons. These majestic columns standing tall at Ter

minal 3 are the witness to our companys Can and WillDo approach.

Netaji Shubhash Chandra Airport, Kolkata, the jewel in thecrown of Airport Authority of India, has recently been awarded

to Star Alubuild Pvt Ltd for 61,000 Sq. Mtrs of exterior faadeworks. Works are well underway at a fast & furious pace

Star Alubuild- India's leading faade engineering company

Star Alubuild Pvt. Ltd.75, Sector8, IMT Manesar

Gurgaon, Haryana,India122050

Ph. No. +911244350000Fax no. +911244086311/12

Email: [email protected]: http://www.Staralubuild.com

Project1ad 2_Layout 1 5/30/2011 4:37 PM Page 1

8CRUISING HEIGHTS JUNE 2011


PERISCOPE

Whither air cargo security?(May 2011) was very inter-esting story to read. Aviationis particularly susceptibleand seems to get more andmore vulnerable after 9/11.Thus air cargo security alsobecomes imminent in thisregard. There are numbers ofchallenges when it comes to

air cargo security. 100 per cent screening for cargoplanes is the need of the hour as well as strikingthe right balance regarding the security.

Pranay Rai, Kolkata

The focus story Strike (May 2011) gave an interest-ing insight into the ever-growing problem of AirIndia. The pilot's strike in Air India has once againbrought into focus the state of the ailing carrier.Every now and then, Vayalar Ravi, Minister forCivil Aviation, announces his commitment tomake a success of Air India but to no avail and thisAir India episode testifies that. The strikes has beenpart and parcel in the history of Air India. But whatbecomes all the more important that strikes havebecome more of a norm than exception.

Sooraj Kumar, Vadodara

After reading the story Pawan Hans defends itself(May 2011), I think that Pawan Hans companyhas not resurrected its chequered history. Afterthese incidents, one can only say that PawanHans has lost its charm and credibility. This raisesserious questions about the charter services inIndia. The Tawang crash has surely sullied theimage of Pawan Hans. Even though, Pawan Hanshas repeatedly claimed that its helicopters wereproperly and regularly maintained, it has littlebearing on the disastrous air accidents in the past.

Kumar Abhishek, Dhanbad

All correspondence may be addressed to

Editor, Cruising Heights, D-11 Basement, Nizamuddin (East),

New Delhi -13, OR mail to [email protected].

LETTERS TO EDITOR

Policy review I request new Chairmen of Public

Accounts Committee (PAC) Dr Murli

Manohar Joshi to highlight the CAG

report on Air India.NNIITTIINN GGAADDKKAARRII, BJP President, on the CAG report pertaining to Air India.

Going GreenWe have a target to get 30 per cent

of our jet fuel from alternative fuels by

the year 2030.KKEENNNNEETTHH KKOOVVAALL , V P, India operations, FedEx Express, on the use of alternative fuels byFedEx.

Reality bites Railway accidents are probed by an

agency of the civil aviation ministry.

Then why shouldn't air accidents be

probed by an outside organisation?SSIITTAARRAAMM YYEECCHHUURRYY, CPI(M) Leader, on on air accidents not being probed by outsideorganisation.

In the driver seat FICCI would suggest ideas on how

the implementation of the Goods and

Services Tax (GST) would affect

taxation in the aviation industry.DDIINNEESSHH KKEESSKKAARR, President, Boeing India, on the taxation issues in the Indian aviation industry.

Raising alarm I'm not saying they should not

recruit children of DGCA officials.

But if it is an irregular recruitment,

the airlines will have reasons to

regret.EE KK BBHHAARRAATT BBHHUUSSHHAANN, Director General,DGCA, on the growing practices ofnepotism in DGCA.

Still dicey The second quarter is likely to see

continued depressed air travel markets

due to the events in Japan and

MENA.GGIIOOVVAANNNNII BBIISSIIGGNNAANNII,, IATA Director Generaland CEO, on the future of air travel marketsahead of events in Japan and Middle East andNorth Africa (MENA).

www.cruisingheights.inwww.cruisingheights.inMay 2011 ` 90

CRUISING HEIGHTSCRUISING HEIGHTS

security

ACI lauds Indias airport journey

Opportunities aplentyfor Eurocopter India

The Air Indiatangle

Pawan Hans defendsPawan Hans defendsits recordsits records

IATA and CAPA onIATA and CAPA onprofitability

TNT looks at TNT looks at domestic growthdomestic growth

Remembering YurisRemembering Yurisfirst flightfirst flight

Those flying TwentiesThose flying Twenties

PLUS

is top priority

air cargo

AIR CARGO SECURITY IS NOW ON TOP OFTHE LIST NOW THAT FOUR ASSOCIATIONSOF THE GLOBAL AIR CARGO ADVISORYGROUP HAVE SIGNED THE BASICPRINCIPLES AND GOT DOWN TO WORK

Periscope June.qxd 5/30/2011 5:13 PM Page 2



Regal Airport Hotel emerges at top Skytrax recently announced the best airporthotels in the world for 2010-2011. HongKong International Airport's And RegalAirport Hotel emerged at the top. WhileCrowne Plaza of Changi Airport securedsecond position based on 860,000 surveyresponses collated over a 12-month period,Sofitel at London's Heathrow Airport stoodat third position and Kempinski Hotel,Munich Airport, managed to garner thefourth position. The Fairmont of VancouverInternational Airport came fifth. The sixth

position went to Langham Place,Beijing Capital InternationalAirport, while the seventhposition was secured by PanPacific Hotel, Kuala LumpurInternational Airport. HyattRegency Hotel of IncheonInternational Airport bagged theeighth position, Stamford Plaza ofSydney Airport stood at No 9 andthe tenth position went toNovotel of Suvarnabhumi Airportat Bangkok.

CO

LD S

TATS

LOOKING GLASS

We've been pushing fora long, long time...It's

time it took off...

TOPPING THE CHART: Regal Airport Hotel atHong Kong International Airport.

Continuing good run Over the last five years, we have seen significant

increase in passenger traffic at Chhatrapati Shivaji

International Airport (CSIA) and this growth is

expected to continue.GG VV SSAANNJJAAYY RREEDDDDYY,, Managing Director, Mumbai InternationalAirport Pvt Ltd (MIAL), on MIAL completing five years of operations.

Enticing offers At Jet Airways, we have always endeavoured to

provide our First Class and Premiere guests with

an unparalleled in-flight travel experience

including a world-class in-flight product, superb

service, and class-leading cuisine.SSUUDDHHEEEERR RRAAGGHHAAVVAANN,, Chief Commerical Officer, Jet Airways, onthe kind of services being offered by Jet Airways to passengers.

Periscope June.qxd 5/30/2011 5:13 PM Page 3

The skyrocketing fuel prices hadan inevitable impact on theearnings of domestic carriers.

But for this factor, the domesticairlines perhaps excluding the stateowned would have been in theprofit region. In the last one year,fuel prices have risen so much thatairlines have become increasinglyweary of undertaking faster capacityexpansion. With economycontinuing to rise, the risingdemand in the face of lower capacityexpansion seems to have deliveredindustry-wise increase in seat loadfactor which the more efficientamong the competing carriers havemanaged to capitalise on.

But the rising demand failed todeliver higher yields because therewas a limit up to which the rising fuelprices could be passed on to thecustomers. As we saw in the past anyunrestricted rise in fare by way ofcomplete pass through of fuel priceshad a debilitating impact on thedemand and even pushing it down.This happened in the recession yearsof 2008-09. Obviously, once bittentwice shy, various Indian carriers didnot wish to repeat that mistake.However, in the process it left themin the red. They would have been ineven deeper red but for across theboard moderate rise in fares byairlines.

Jet Airways (India) Limited alongwith its low cost arm JetLite

registered a loss of `200 crore duringQ4 of fiscal 2010-11 (Jan-Mar 2011)compared to a profit of `224 crore inthe fourth quarter of previous fiscal2009-10. The rising fuel prices wipedout the profits the airline made in thefirst three quarters of fiscal 2010-11.Raj Sivakumar, Jet Airways VicePresident (Network Planning,Revenue Management andDistribution) said: It is only fuel andnothing else that was a majorburner. For the same level ofoperation Jet Airways paid additionalfuel bill of `343 crore. Overall, Jetsfuel bill in 2010-11 was `1279 crroewhich was `443 crore more than itspent in 2009-10.

Compared to a net loss of `420crore in 2009-10, Jet made aconsolidated net loss of `86 crore infiscal ending March 31, 2011.Compared to last fiscal the netrevenue of the airline in 2010-11 roseby 20 per cent to `14737 crore. Theloss was contained by aggressiveroute rationalisation and cost cutting.Jet Airways CEO Nikos Kardassis,said: While we may not be able toimpact external factors, Jet Airwaysrelentless focus remains onimproving efficiencies andproductivity. Airlines world overhave been hit by rising fuel pricesand Jet was no exception. Therefore,this could impact traffic growth in theshort run but in the medium term thegrowth outlook may remain intact.

An assessment of the airlinesresult showed that rising fuel pricesand stiff competition impacted JetAirways profitability as much others.Compared to a net profit of `4.62crore in the Q4 of 2010, it made a netloss of `107.5 crore in Q4 of fiscal2011. The impact would have beenlower by `58 crore, which the airlinehad to pay as per the service taxdemand raised on it. The fear is thehigh fuel prices are well on their wayto impact the earnings in the firstquarter Q1 (April-June) of currentfiscal 2011-12 as well. The intensity ofthe problem is evident from the factthat while in Q4 2010, Jet registered aseat load factor of 75 per cent, thisrose to 79.2 per cent in Q4 2011.

This clearly meant that the yieldshad failed to keep pace with rising fuelprices which could not be passedthrough fully to the passengers for fearof losing passengers. This is evidentfrom the fact that while internationaloperations rose by 18 per cent,domestic rose by 9 per cent and trafficcarried by Jet rose by 15 per cent in Q4.Despite all these its yields rose by onlyone per cent. During fiscal 2010-11, JetAirways registered total revenues of`14522 crore. On a year-on-year basisand on stand alone basis, Jet made asmall profit of `9.6 crore compared to aloss of `467 crore in 2009-10.

In the current fiscal 2011-12, JetAirways is proposing to add 10aircraft of which four will be for



NEWS DIGEST

The Q4 results and the outlook ahead

NEWS DIGEST NEw.qxd 5/31/2011 3:32 PM Page 2

replacement of its older aircraft. It isalso expecting two of its Boeing 777to be returned in Q1 of 2011-12 by theforeign carrier which had taken it onlease. Once the aircraft are received,Jet will replace upgrade the routesusing A 330 with B 777. The A 330released will be deployed on its newinternational route to Manila andsome Gulf routes.

The airline will also soon do asale-and-leaseback transaction for 10Boeing-737 aircraft, freeing uparound `600 crore for the airline.While the savings on interest wouldbe insignificant, since it would needto pay rentals on the aircraft, thecompany could retire a small part ofits debt. While the companys totaldebt is estimated at close to `13,000crore, the high-cost portion isapproximately `3,000 crore. Thecompanys net debt-to-equity for theyear to March 2011 is estimated byanalysts to be over 1,100 per cent,after the announcement of thecompanys results for the December2010 quarter.

Jet Airways total debt as on dateis `13,000 crore of which workingcapital loan alone is `3500 crore. Thefear gripping Jet like any otherborrower is the prospects of risinginterest rate which will surely delivera serious blow to it.

Kingfisher Airlines suffered a lossof `1027 crore in fiscal 2010-11 as against a loss of`1647.20 crore in theprevious fiscal 2009-10. Itdid not issue separatelyresults for Q4 of fiscal 2010-11 but released theconsolidated results. Asper this, its losses fell by 38per cent year-on-year basisdue to restructuring of theloans as also improved performanceof the airline. Kingfisher AirlinesEBIDTA stood at`140 crore as againsta negative`690 crore in previous fiscal2009-10. This meant a virtual recoveryof `830 crore over the year.

The airline reportedly madeoperational profits. It clocked annual

revenues of `6496 crore, which was 23per cent more than the previous year.

This was due to increase inpassenger traffic and better capacityutilisation. A major reason for thebetter financial performance was thedebt recast the airline got from thebanks in 2010 which helped it lowerinterest costs. While the passenger

load factor, the airline industry as awhole rose by 6 per cent to 78 percent in 2010-11, for Kingfisher it roseby 9 per cent to 81 per cent. What issignificant here is that KingfisherAirlines managed to up its load factorand passenger carried despiteoffering fewer seats following theunplanned grounding of some of itsaircraft. Its fleet size fell by one to 66in 2010-11 compared to 67 in 2009-10.

It also incurred an excess cost of`220 crore on account of some of its

aircraft being grounded in2010-11. On the outlookfor this year, KingfisherAirlines said the demandcontinued to be robustwhich was backed bystrong macro economicenvironment and growthin most industrysegments. Domesticcapacity expansion is

expected to remain lower thangrowth in demand resulting incontinued increase in industry loadfactor in fiscal 2011-12. Yields arelikely to remain stable.

Meanwhile, SpiceJet Ltdannounced a loss of `59 crore in thefourth quarter, compared with a

profit of `27.45 crore a year earlier,because of rising fuel costs. But itmanaged to swing to a record annualprofit of `101.15 crore on the back ofits strong first three quarters. The six-year-old SpiceJet made its first profit(`61.45 crore) in fiscal 2010. Quarterlyrevenue rose to `759 crore from `573crore.The carrier needs to raisearound $250 million this fiscal toexpand its fleet to 43 from 29. Nearly80 per cent of this fund requirementis already tied up in financing with aCanadian lending agency forBombardier Q400s, Mills said afterthe results were announced.

The balance $50 million, oraround `200 crore, is likely to beinfused by the promoters to helpfund the long-term growth, hesaid.

SpiceJet flies 29 Boeing 737aircraft with 192 daily flights to 23cities. This fleet will expand to 43aircraft with 11 owned BombardierQ400s and leased Boeing 737s. Millssaid international operations willremain at less than 10 per cent of theairlines total revenue despite theexpansion.

The focus will remain on thedomestic market, which is expectedto expand in double digits this yeartailing last years 18 per cent growth.

Some new international cities,besides Kathmandu and Colombo,will be added to the airlines networkdepending on the routes granted bythe aviation ministry.

In the quarter ended 31 March,SpiceJets fuel expenses jumped to`395 crore from `214 crore earlier,partly on the back of risinginternational fuel prices. Fuel pricesconstitute 30-50 per cent of an Indiancarriers costs. The fourth quarterwasnt as good you would haveexpected, Mills said. There was a35 per cent jump in (international)fuel cost, but the other differencewas the indiscipline in pricing fromone of our competitors. He wasalluding to Air Indias dead cheapticket price strategy to overcome theturbulence in the airline.



Vijay Mallya Naresh Goyal

Neil Mils


Evidence gleaned from the AirbusA330s Air France flight 447 in2009 that killed 228 people

shows the autopilot disengaged afterspeed readings became unreliable,forcing the two co-pilots in thecockpit to take over, just as the jettraversed a storm. Data from the finalminutes indicate the aircraft went intoa stall before crashing into the sea,four hours into its flight to Paris.

The BEA, Frances flight-accidentinvestigator, has revealed in its initialfindings, its first findings from theanalysis of the two data recorders.The boxes were retrieved from thebottom of the Atlantic this month,after almost two years of intermittentsearch missions. The data and voicesproved to be intact, allowing the BEAto reconstruct Flight AF447s lastminutes.

The aircraft took off on May 31,2009, in Rio de Janeiro under thestewardship of Chief Pilot MarcDubois and two deputies. About fourhours into the flight, the A330, nowcruising on autopilot at an altitude ofabout 35,000 feet (10,700 metres),passed over an area known as theinter-tropical convergence zone closeto the equator where storms produceicy, windy conditions that create

frequent turbulence. With Dubois taking a routine

break outside the cockpit, the twoless-seasoned pilots were in chargewhen the planes air speed sensorsfailed, most likely after icing up. Theabsence of reliable speed dataprompted the autopilot to disengage,data transmitted from the flight hasshown.

Amid darkness and likely stormturbulence, the two pilots were forcedto take control and keep the correctlevel of thrust on the two engines tomaintain the right air speed and pitchattitude, the degree to which the jetsnose is tilted upward, according totwo people who have been briefed onthe data recorders. They spoke oncondition of anonymity ahead of theBEAs report.

Readings from the flight dataretrieved from the sea bed show thejet lost velocity, which led to a low-speed stall because the plane slowedto the point where its wings suddenlylose lift. While getting out of a stall ispart of any standard pilot training,coping with the challenge amidadverse weather conditions, darkness,and a multitude of automated alarmsignals may have overwhelmed theflight crew.



IBS DEAL WITH CARGOITALIAKerala-based software firm, IBSSoftware Services, has inked adeal with Cargoitalia, an Italianairline, for implementing its cargomanagement solution, iCargo.Theimplementation is set to becompleted by July. The solutionwill then manage the entire freightmovement of this all-cargo carrierincluding core-cargo operationsfrom quotes and bookings throughcapacity and revenuemanagement, track and trace,accounting and proof of deliveries.

NO IPO FOR EMIRATESEmirates chairman and chiefexecutive Sheikh Ahmed binSaeed al Maktoum has dismissedspeculation that the record-breaking profitable airline will bepart of a privatisation initiative bythe Dubai government. SheikhAhmed said:An IPO is notgoing tohappen thisyear or next,beyond that Icannot say as isthe decision ofthegovernment.But there is no need to do it.Given Emirates healthy cashbalance, an IPO is beginning tolook more of a faint hope as eachyear passes. There isnt a pressingneed to launch an IPO and onewouldnt be surprised if this is thestance they hold until the turn ofthe decade.

GMR AIRPORTS TO RECEIVE $200 MN FDI

Thegovernmenthas

approved a proposal of the GMRAirports Holding to receiveadditional foreign directinvestment (FDI) of $200 million.This will be in addition to theearlier approval to induct foreigninvestment of $200 million. Thetwo proposals will result in FDIinflows of `1,920 crore. Theforeign investment will bereceived by way of subscription

INFRASTRUCTURE NEWS

AF 447 findings

NEWS DIGEST

Saeed al Maktoum




to compulsorily convertiblepreference shares of face value of`1,000 each pursuant to ForeignInvestment Promotion Boardrecommendation in its meetingheld on February 15, 2011, anofficial statement said.

CM SEEKS GRANT FOR 3 NEWAIRPORTS IN UTTARAKHANDUttarakhand Chief MinisterRamesh Pokhriyal Nisahank hassought the development of threenew airports in the hill state.

Nishank said the Centreshould develop Naini-Saini

airport inPithoragarhdistrict,Chaniyalisaurin Uttarkashiand Gauchar inChamoli districtwith the centper centinfrastructure

grant. All these three airportsare located near the internationalborders which are strategicallyvery important, he said in arepresentation to Montek SinghAhluwalia, Deputy Chairperson ofthe Planning Commission.

The Chief Minister cited theexamples of Pakyong airport inSikkim, Itanagar in ArunachalPradesh and Cheithu in Nagaland,which are being developed. Thethree airports in Uttarakhand canalso be developed by the AirportsAuthority of India similarly,Nishank emphasised. Thedevelopment of the three airportswould not only give fillip to thetourism sector in the hill state butalso help in providing quick reliefduring the time of naturaldisasters, he said.

DURGAPUR AIRPORT TO BEREADY BY 2012

The DurgapurAirport citypromoter, Bengal

Aerotropolis Projects Ltd (BAPL)expects the state government tohand over the last portion of 525acres by July, concluding a 30-month ambitious process toacquire 2,345 acres. The last tract

INFRASTRUCTURE NEWS

With plans to increase routes to40 cities by end of this year,flydubai CEO Ghaith Al

Ghaith has set his sights on possiblyadding more flights to the Asian sub-continent. The carrier is also on trackto launch its holiday packagesconcept soon.

Speaking tojournalists recently,the head of Dubaislow-cost airlines, however, refused toconfirm if India was the destinationof choice, saying: We are certainlylooking at going from 36 destinationsto 40 by the end of 2011 but it is tooearly to confirm the new cities we areflying into.

Looking at the demand andnumbers, the subcontinent, the GCC,Eastern Europe and the Far East

routes are all very attractive to us.Expansion into these regions is anatural progression.

When asked specifically aboutlaunching more services to Indiaconsidering in 2009 the airline wasforced to postponeits three routes,

Coimbatore, Chandigarhand Lucknow, andreimburse passengersdue to operational

issues, Ghaith said: This has nothingto do with me. The conversation overlanding rights is between the twogovernments. The dialogue is alwaysgoing and we are always ready to flyon routes that there is a market for.

Ghaith also confirmed that theairline is expecting a capacity increaseof 140 per cent over last year.

Jet Airways plans to bring all itslow-fare operations under the JetKonnect brand and phase out the

JetLite brand completely. The countrys largest airline by

passengers carried believes that thismove will simplify operations andremove the current confusion overtwo similar low-fare brands JetKonnect and JetLite.

Though no timeline is availablefor this transition, sources in theaviation industry and some officialsof Jet confirmed that internaldiscussions have been held onphasing out JetLite. These talks havegained momentum after the recentBombay High Court order, which

ended a messy legal battle betweenJet and Sahara India CommercialCorporation. The battle has its originsin Jets April 2007 purchase of SaharaAirlines which operated Air Sahara and later rebranding it to JetLite.

This court order will now enableJet to carry out several businessoperations, including developingland, selling and leasing back of

planes and rebrandingJetLite, all of which hadcome under a cloudbecause of the litigation. In2009, when the aviationbusiness went into atailspin, Jet had no optionbut to float a new brand(Konnect) to increasecapacity on low-fare routessince it could not do sounder JetLite. Analystspoint out that now JetAirways is free to runJetLite the way it likes andtake outstanding deliveriesof planes from Boeing.But why does Jet want to

phase out the JetLite brand? Anairline official explained that doing sowould create some business classseats on low-fare routes. Konnectaircraft already offer some businessclass seats at lower fares whereasJetLite flights are all economy.

Flydubai take-off with 140 per cent

Lit may go Konnect in Jet!Ramesh Pokhriyal

Jet Airways JetLite


It will be Giovanni Bisignanis lasthurrah and the first for Tony Tylerand there will be plenty of

emotions when the International AirTransport Association (IATA)heavyweights meet for the 67thAnnual General Meeting (AGM) inSingapore from 5 to 7 June 2011. Thiswill be the third time that Singaporewill host the IATA AGM. The firsttime was in 1976. The last time was in2004 when the industry took thehistoric decision to move to 100 percent e-ticketing globally

This year, the AGM will take placeas the industry continues its recoveryfrom the global financial crisis. Themeetings agenda will comprise themajor topics facing air transporttoday, including the drive for evenbetter environmental performance,the impact of rising fuel prices onweak industry profitability andefficiency gains through technology.One highlight of the event will be along-term look at aviations futurewith the presentation of the results ofIATAs Vision 2050 initiative. The 67thIATA AGM was originally scheduledto be held in Cairo, Egypt. We regretnot being able to host this event inEgypt as originally planned. We lookforward to hosting a future AGM in

Egypt when its political transition iscomplete, said Bisignani.

Bisignani joined IATA as DirectorGeneral and CEO in June 2002. Sincethat time, he has reshaped andrefocused the organisation to betterserve its global membership of 230airlines with a mission to represent,lead and serve the air transportindustry. Bisignanis agenda of changehas impacted the industrys toppriorities through programs such asthe IATA Operational Safety Audit,the first global standard for airlinesafety management, and Simplifyingthe Business, which uses technologyto bring convenience to travellers andcost reduction to airlines. Mostrecently, Bisignani put IATA in thecentre of the debate on climate changeand aviation, uniting the industry in adrive to achieve carbon neutralgrowth and eventually zero-carbonemissions. Before joining IATA,Bisignani launched the Opodo travelportal and was CEO and ManagingDirector of Alitalia. He has been amember of the Pratt & WhitneyAdvisory Board, chairman of GalileoInternational, and held seniorpositions at Citibank.

The now incoming DG,Tony Tyleris a classic industry insider having

retired from the top job atCathay Pacific just months

back. If Bisignani is feistyand tough as nails, Tyler issuave and silken smoothbut with the same steelydetermination that hadmade Bisignanis tenureso memorable.

Hurrah for Bisignani, hello to Tyler

Giovanni Bisignani

Tony Tyler



of land includes those in Andal,Badur and Dubchuria moujas.

Anticipating a commissioningdate in July 2012, BAPL officialsheld talks with SpiceJet andIndiGo on April 27 and presentedpassenger potential statisticsthrough trend analysis, travelagents feedback and a marketresearch survey. Route planningdata prepared by Changi Airportsafter analysing traffic studiesshowed the potential to operatetwice daily flights to Delhi withAirbus 319/320 or Boeing 737-800/900 aircraft and one flighteach on Bagdogra-Durgapur-Mumbai and Guwahati-Durgapur-Chennai/Bengalurusectors daily with similar aircraft.This is apart from a daily ATRservices to Kolkata.

SpiceJet and IndoGo apart, thecarrier has held preliminary talkswith Air India, Jet Airways andKingfisher Airlines to operateregional flights. The response hasbeen encouraging. A clearerpicture will emerge when we willbe closer to the commissioningstage."

NAVI MUMBAI AIRPORT CLEARSFINAL HURDLE

The steering committee of theUnion Civil Aviation Ministry hascleared the final hurdle for theNavi Mumbai internationalairport. The stamp of approval tothe master plan was given at ameeting held in New Delhi. Theairport will be developed in fourphases with 2014, 2017, 2025 and2031 as deadlines with a capacityof 60 million passengers perannum by the end of 2031 asagainst 10 million passengers perannum at Mumbai internationalairport.

The Civil Aviation Ministry

INFRASTRUCTURE NEWS

NEWS DIGEST




will now hold another meetingwith CIDCO, which is the nodalagency for the airport project,within the next two months toselect the Request for Proposal(RFQ) the process ofshortlisting developers for theproject.

While clearing the airportproject, Civil Aviation SecretaryNasim Zaidi asked CIDCO to puton hold the proposed demolitionof a hillock till the developer isfinalised. CIDCO had soughtpermission to demolish the 92-metre hillock on the airport site.The meeting was also attended byAirports Authority of India (AAI)chief Vijay Agarwal and CIDCOchief Tanaji Satre. The CivilAviation Ministry also took areview of the land acquisition,shifting of the electricity towers onthe plot and rehabilitation ofvillagers that get affected with theproject.

To ensure that the proposedNavi Mumbai international airportdoesnt face problems similar tothose at Mumbai airport causedby the cluster of slums, CIDCOhas decided to keep 370 hectaresaround the new site as a no-development zone.

Meanwhile, In an effort tostudy how cities having more thanone airport distribute air trafficamongst themselves, CIDCOofficials have spent a week in theUS during which they visited NewYork City, Washington DC andMiami. The Navi Mumbai airport,the second airport in Mumbai, willhandle one crore passengersinitially. Bids for developing theproject will be invited later thisyear. The Navi Mumbai airportneeds a total of 2,020 hectares ofland. Recent reports suggest thatout of this, 1,333 hectares arealready with CIDCO, another 263hectares of government land is inthe process of being transferred toit. 424 hectares of private land isstill to be acquired.

AAI FOR REGIONAL HUBS The Civil Aviation Ministry hasagreed in principle to developGuwahati, Agartala, Imphal and

INFRASTRUCTURE NEWS

The Directorate General of CivilAviation (DGCA) will no longerbe the three-in-one investigator-

prosecutor-judge combine when itcomes to investigating serious airmishaps.

The government hasissued an order to set upan independent panelunder the Civil AviationMinistry that will take helpfrom independent expertsto investigate accidentsand serious incidents. Thepanel will conduct theprobe independent of theDGCA. The demand forhaving an independent investigatorgained momentum after last yearsMangalore crash and the recentspate of incidents in Pawan Hans.The accident investigation committeewill have five officers apart fromindependent resource personnelwhose help they can take. The panelwill classify a mishap as accident orserious incident as this rating has

serious impact on the airlinesinsurance premium and has beensuspected of being manipulated inthe past, said a senior official.

Under the new system, reports ofany mishap will be sent to the

DGCA along with a copyto the panel. The panelwill also follow upimplementation of thesafety recommendationsmade with every probereport. It will also advisethe DGCA from time totime on accidentprevention steps, saidsources.

The government studied variousmodels for deciding the shape of theindependent probe panel. Usually,probe panels are kept away from thedepartment whose accidents theywould probe to have a fair andindependent report with low chancesof manipulation. For instance, theagency probing railway mishapscomes under the aviation ministry.

Prime Minister Manmohan Singhacknowledged that nationalcarrier Air India was passing

through a difficult phase, butsought to put the blame for thesituation on global recession and highcosts of operations. Air India ispassing through a difficult phase as aresult of globalrecession and highcost of operation.Equity support hasbeen injected in2010 and 2011.Turn-around planof Air India isbeing closelymonitored, Singhsaid in the report Government ofthe UPA: Report tothe people on completion of twoyears of UPA-II.

He also praised public sectorhelicopter service Pawan Hans, whichhas been in the news for the wrongreasons due to a spate of crashesrecently. Pawan Hans hasintroduced sea plane operations inAndaman and Nicobar Islands as a

pilot project to connect Port Blair andHavelock and other islands in NorthAndaman, Singh said.

He lauded some of theachievements of his government inthe field of civil aviation likecompletion of Phase-I work of IndiraGandhi International Airport and

Terminal 3becomingoperational inJuly 2010.

The IGIairport, whichcan handle 34millionpassengers perannum, wasadjudged thefourth best in theworld. Two mega

projects are being undertaken atChennai and Kolkata airports fortheir modernisation anddevelopment. Singh said Indiaparticipated in the Assembly Sessionof the International Civil AviationOrganisation held in 2010 in which itwas re-elected to the Council ofICAO.

DGCA stripped of probe powers

PM on AI and other issues

Arvind Jadhav Manmohan Singh

Bharat Bhushan


Singapore Airlines (SIA) will setup a low-cost, long-haul airlineas Jetstar and AirAsia X to lure

intercontinental travelers withcheaper fares. The new airline willbegin flights within a year, usingwidebody planes. The units name,management and route network willbe announced at a later date, it said.

It will initially source thewidebodies from SIA. The airline has

some Boeing 777-200s and Boeing747-400s that it is planning to phaseout this year. It could have thesereconfigured for the new long-haul,low-cost carrier. Industry executivessay SIA is more likely to use theBoeing 777s for the new outfitbecause they burn less fuel than the747s.

According to CAPA (Centre forAsia Pacific Aviation), it is believedthe new airline will be a point-to-point carrier and will have acompletely separatemanagement team and acompletely differentbrand than SIA. Thiswill ensure that the newairline captures newsegments of the market,rather than takes trafficaway from the mainlinecarrier.

SIA declined to saywhich routes the newlong-haul, low-costcarrier will serve, but itcould end up targeting marketssimilar to those operated by AirAsiaX, a long-haul, low-cost carrier basedin Kuala Lumpur. One of AirAsia Xsmajor markets is Australia, where ithas had success winning overstudents and price-conscious leisuretravelers. This is a consumer segment

that SIA hopes to tap with its newcarrier.

Singapore Air faces increasingcompetition on long-haul routes fromthe Singapore-based unit of QantasAirways Jetstar arm. Jetstar beganflying from Singapore toMelbourne in December, offeringboth economy and business-class seats. The carrier hasalso started Auckland flights,

and it may add services to north Asiaand southern Europe this year. Thecarrier was then touting fares 30 percent cheaper than rivals.

Qantas has also used Jetstar totake over or begin routes that werentprofitable enough for the mainlineoperations. The budget unit has beenable to support these flights becauseits costs are as much as 40 per centlower than the Qantas-branded units.The carrier is now the fastest-growing

flying business at Sydney-based Qantas, contributingabout a third of earningsbefore interest and tax inthe six months ended Dec.31.

AirAsia X, partlyowned by AirAsia Bhd. andRichard Bransons VirginGroup Ltd., flies to London,Australia and Japan fromits Kuala Lumpur hub. Theairline plans to more thantriple its fleet to 38 planesfrom 11 by 2020. Tiger Air,AirAsia and other budget

carriers have won market share inAsia as they add new planes andintroduce more routes. Low-costairlines passenger numbers jumped26 per cent at Singapores Changiairport last month, more than doublethe pace for full-service carriers



Dibrugarh airports in North-Eastas regional hubs. To begin with,the related works for developingregional hub at Guwahati isexpected to start in June. Theministry has also agreed to thedemand of Ministry ofDevelopment of North-EasternRegion (DoNER) to increaseflights to Lilabari and Tezpurairports in Assam, which are closeto Arunachal Pradeshs capitalItanagar. Lilabari airport will nowhave five daily flights, connectingKolkata and Guwahati. Similarly,Tezpur too will have five dailyflights to Guwahati and Jorhat andone weekly flight to Silchar andKolkata.

The foundation stone for theregional hub in Guwahati isexpected to be laid soon. This willhelp in night parking of aircraft atGuwahati and early morningoperations to the interiors of theregion. Both the ministries havealso agreed to establish acomposite training school forground-level staff for navigationand aircraft maintenance atLilabari, Assam. Land has alreadybeen acquired by Assamgovernment and the project willbe funded by North EasternCouncil (NEC).

BIAL TO EXPAND TERMINAL Bangalore International AirportLimited, the operator of theBengaluru International Airport,has said that the expansion of the

passengerterminalbuilding willcommenceduring June2011. Theterminal iscurrentlyspread over an

INFRASTRUCTURE NEWS SIA forms budget long-haul carrier

Goh Choon Phong

ww

w.stra

itstimes.c

om

NEWS DIGEST

G V Sanjay Reddy

Guwahati Airport




area of 70,000 sq metres. Oncompletion of the expansion work,the terminal area will be doubled.The terminal capacity will beincreased to over 17 millionpassengers a year, with theflexibility to expand to 20 million.This is expected to meet the trafficdemand for the next few years.Simultaneously, a comprehensivereview of the master plan is underway.

With the commencement ofthe terminal expansion, we hopeto alleviate any hurdles beingfaced by passengers today. On itscompletion, we envision anenhanced airport that befits thecity of Bengaluru, enhances itsbusiness opportunities,complements its culture andwelcomes its visitors, said G VSanjay Reddy, Managing Director,Bangalore International AirportLimited. The design of theexpanded terminal will sport anenhanced and modern designelevation and will be completedapproximately 18 months from thecommencement of theconstruction.

The construction partners forthe project chosen are Larsen &Toubro, through an internationalcompetitive bidding process. Theenhanced terminal is aimed atsignificantly improving passengerexperience, making access toseating, amenities and commercialfacilities easier and better

DELOITTE PICKS HOLES IN AIRINDIAS REVIVAL PLANCasting doubts on Air Indiasturnaround plan, Deloitte ToucheTohmatsu India said that theairline has overplayed its revenue,yield and market share growthprojections while understating alikely increase in fuel and staffexpenses. The consultancy criticisedAir Indias assumption that fuel

INFRASTRUCTURE NEWS

Even as Air India tries to raise its headfrom the depths it finds itself in, movesare on to improve its image. Air Indiasinflight magazines the 35-year-oldSwagat producedby Media Transasiafor erstwhile IndianAirlines andNamaskarproduced by CMYKPrintech Ltd forerstwhile AirIndia have beendiscontinued with a new one. KamaljitRattan, Air India CorporateCommunications Chief said: Withnational and international flightshaving one single code AI, there isno point of having two separateinflight magazines for the mergedsingle entity.

Air India did a series ofpresentations to various stakeholdersto point out that the airline nowneeded just one magazine. Rattan

emphasised the factthat one publicationwould go a longway to build thebrand image of AirIndia.

However,tenders werefloated and the

contract for a single magazine has beenawarded to Maxposure Media forthree years. The magazine, to beknown as Air India Magazine, will beavailable on both international anddomestic flights. But one will miss theold brands, particularly Swagat, thefirst of India's inflight publications.

A brand makeover for the Maharaja

Richard Branson said hes intalks with as many as threepotential suitors for Virgin

Atlantic Airways Ltd. and that heslikely to reach a decision on apartnership sometime in the nextquarter.Discussions with two orthree parties are progressing,Branson told journalists and added,Within the next two or threemonths we should be clear onwhether theres an alliance werehappy with or not.

The airline has hired DeutscheBank AG to assess Virgin Atlanticsstrategic options as rivals BritishAirways and American Airlinesboost cooperation on key trans-Atlantic routes. The entrepreneur,who founded the U.K. carrier in1984, said that while joining analliance is essential, its not yet clearwhether he will sell down his 51per cent stake.Ive always madeclear that I would still be verymuch involved, Branson said.My principal interest is in thealliance. If it means selling shares,well consider that.The fate of a 49per cent stake in Virgin Atlanticheld by Singapore Airlines Ltd.,which could determine control ofthe company, will probably turn onthe choice of alliance, he said.

Branson closing on alliance

ww

w.p

eakoilta

skfo

rce.n

et

Richard Branson


We are seeing a new marketsegment being created and this willprovide another growth opportunity,said Chief Executive Goh ChoonPhong in a statement. As we haveobserved on short-haul routes withinAsia, low-fare airlines help stimulatedemand for travel, and we expect thiswill also prove true for longer flights.At the same time we remain fullycommitted to the further growth ofSIA, which will continue to offer thehighest-quality products and servicesto our customers, he adds.

The surprising, but also potentiallyfar reaching, announcement couldsignal much more than merely anotherexample of an Asia Pacific long-haullow-cost operation. For SingaporeAirlines it marks a major refocus of itslong-term strategyrestoring growthand catering more effectively for theburgeoning leisure market. Over thelast several years SIA has seen its shareof its home market steadily drop aslow-cost carriers have rapidlyexpanded. This trend accelerated inrecent months as SIAs traffic has

shrunk and load factors dropped, whilelow-cost carriers continued to expandrapidly and improve their load factors.

In the fiscal year ending March2011 (FY 2010-11), SIA transported16.6 million passengers. A decadeearlier, in FY 2000-01, SIA transported15 million passengers. This representsonly 11 per cent growth over the last10 years, or a paltry 1.1 per cent perannum. Total traffic at Changi duringalmost the same period (fromcalendar 2000 to calendar 2010)increased from 28.6 million to 42million passengers, representing 32per cent growth over the decade or3.2 per cent per annum.

SIA is poised to become only thesecond full service carrier in theworld (after Qantas) to establish along-haul low-cost subsidiary. Theother successful combination, alsobased on connecting andcomplementing the parent carrier isthat of AirAsia X, whose model hasdepended so much on the growingability for low-cost operators tonetwork their operations.



costs, which account for nearly 40per cent of an airlines operatingexpenses, would not rise.

In December 2010, Deloittewas appointed to review theturnaround plan drafted by SBICaps and Air India. Theunderlying theme of the Deloittereport is that the turnaround planis not feasible and is riddled withwrong assumptions leading toambitious projections andrealisations. In short, it is notrealistic and workable.

Deloitte has also questionedAir Indias fleet acquisition plan,indicating that such a strategycould actually lower yields andhave adverse financialimplications. Aviation consultancySimat Helliesen & Eichner, whichcarried out a detailed routeplanning and capacity exercise,has suggested 87 narrow-bodyaircraft for Air India by 2015, butthe carrier has proposed 143,according to Deloittes reportdated February 11, 2011.

The only justification that onecan have for going in for suchcapacity expansion can, therefore,be the adoption of a strategy ofbuying market share throughdeploying high capacity into themarket (with corresponding loweryields and consequent financialimplications), Deloitte said. OnAir Indias plan to increase wide-body aircraft to 54 by 2014-15from 30 at present, Deloitte saysthat before buying these planes,the airlines priority should be toincrease the passenger load factor(PLF) on existing routes.

Air India, which witnessedalmost constant flat yields over thelast five years, expects yields fromwide-body aircraft to grow atroughly 5 per cent per annum andat 3 per cent per annum fromnarrow-body aircraft. In effect,therefore, Air India has assumedthat all three factors capacity,PLF and yields will witnesssimultaneous increase. In acompetitive scenario, thisassumption seems ambitious andreflects the best-case scenario,Deloitte said.

INFRASTRUCTURE NEWS

NEWS DIGEST

Boeing narrowed its targetdate for delivery of the first787 Dreamliner as it

announced plans to run mockcommercial flights with the firstcustomer, Japanese carrier AllNippon Airways.

Boeing said in a statement itplanned to deliver the first planebetween August and September.Using the second flight test aircraftcode-named ZA002, Boeing said itplanned to carry out test flights inJapan together with ANA to helpprepare for real operations.

The in-service test flights will

take place in the week of July 4.Boeing expects to fly theDreamliner between HanedaAirport in Tokyo and airports inOsaka, Okayama and Hiroshima.During the July validation, ANAsmaintenance crews will alsopractise maintenance and servicingof the 787. This will includetypical ground-servicing activities,fit checks of airplane jacks andmaintenance hangar stands, towingand refueling the airplane, andother routine maintenanceoperations, said Boeing.

Boeing 787 set for August delivery

ww

w.jyi.o

rg


The month of April 2011 witnessed decrease inseat factor as compared to previous monthprimarily due to lean season. Passengerscarried by domestic airlines during Jan-Apr2011 were 190.02 lakh as against 160.42 lakh

during the corresponding period of previous yearthereby registering a growth of + 18.4 per cent. The market share of domestic passengers carried by

the scheduled airlines in April 2011 was: IndiGo:19.7 per cent; Jet Airways: 17.5 per cent and Jet Lite:7.3 per cent (Jet Airways + JetLite = 24.8 per cent);

Kingfisher: 20 per cent; Air India (Domestic): 15.4per cent; SpiceJet: 13.6 per cent and GoAir: 6.4 percent.

The overall cancellation rate of scheduled domesticairlines for the month of April, 2011 was 2.3 per cent.The cancellations by domestic carriers were: IndiGo(0.4), GoAir (0.4), SpiceJet (1.1), Jet Airways (1.1),Kingfisher (0.8), Air India-Domestic (8.9) and JetLite(2.3). The major cause of cancellation was due tooperational (64.8 per cent) followed by miscellaneousreasons (13.6 per cent); weather which accounted for



TRAFFIC DATA

Air traffic registers marginal growth

Pax Carried (in Lakhs)

150

100

50

0

200

250Growth - YoY(+18.4%)

- MoM(+11.5%)2010 2011

YoY

160.42

190.02

41.88 46.71

MoM

Passengers carried by domestic airlines during Jan-Apr 2011 were 190.02lakh as against 160.42 lakh during the corresponding period of previousyear thereby registering a growth of +18.4 per cent.

PASSENGERS CARRIED BY SCHEDULED DOMESTIC AIRLINESCommercial

4.7%

Operational64.8%

Consec/Misc13.6%

Weather4.5%

Technical12.4%

REASONS OF CANCELLATIONS

Excessive (> 44 min)5.0%

Very Late (15-29 min)9.0%

Late (30-44 min)3.9%

79.9% (Departures)

ON-TIME PERFORMANCE FOREIGN CARRIERS70 foreign carriers operating to/from India. At the time ofcompilation of this report, OTP data of 55 carriers was received.On-Time Performance (Apr 2011):

On-Time82.1%

Late (15-29 m)10.4%

On-Time80.7%

81.2% (Arrivals)

Very Late (30-44m)4.1%

Excessive (> 44 m)4.8%

ON-TIME PERFORMANCE FOREIGN CARRIERS

New Traffic Data.qxd 5/30/2011 5:08 PM Page 2



4.5 per cent. The other causes were technical (12.4 percent), commercial (4.7 per cent).

During the month of April 2011, total number of 1090passenger-related complaints had been received bythe scheduled domestic airlines. The number ofcomplaints per 10,000 passengers carried for themonth was 2.4. Jet Airways recorded the highestnumbers of passenger complaints (4.1) while GoAirwas the lowest (1.7). The other carriers recorded:SpiceJet (2.4), JetLite (2), Kingfisher (1.7) and AirIndia Domestic (1.9).

The overall On-Time Performance (OTP) ofscheduled domestic airlines for April 2011 was 88.1per cent. A majority of delays have been attributedto reactionary causes (57 per cent) while weather (2per cent), government authorities (9 per cent) andmiscellaneous reasons (9 per cent) were secondbiggest causes of delay. Jet Airways had the highestOTP of 92.5. Other airlines' OTP in the month were:IndiGo (92.4), Kingfisher (91), JetLite (91.8), AirIndia Domestic (77.4), Spicejet (80.9) and GoAir(92.2).

% of Total Ops OTP

Scheduled Domestic Airlines, Overall OTP (Apr 2011)-88.1%

20

40

60

80

120

100

0Jet Airways Go AirIndiGo Air India (Dom)JetLite Kingfisher SpiceJet

On-Time Performance (%)

15.14.7 6.5

23.3

10.8 4.7

92.5

21.6

92.4

17.9

92.2 91.8

77.480.9

91

ON-TIME PERFORMANCE (OTP)

GoAir6.4%

JetLite 7.3%

Air India (Dom)15.4%

IndiGo19.5%

Jet Airways17.5%

Kingfisher20.0%

SpiceJet13.6%

MARKET SHARE OF SCHEDULED DOMESTIC AIRLINES

Overall Cancellation Rate in Apr 2011 2.3%

Air India

IndiGo

JetLite

Kingfisher

SpiceJet

GoAir

Jet Airways

0 1 2 3 4 5

Cancellation Rate (%)

0.4

0.4

0.8

1.1

1.1

2.3

8.94.1

CANCELLATION DATA OF SCHEDULED DOMESTIC AIRLINES

10

40

30

20

0

-10

-20

-30

-40

May Jun July Aug Sep Oct Nov Dec

Year-over-Year

% c

hang

e ov

er M

onth

Jan Feb Mar Apr

Capacity (ASKM) Demand (RPKM) CAPACITY VS DEMAND

The month of Apr 2011 witnessed decrease in seat factor as compared toprevious month primarily due to lean season.

Seat

Fac

tor (

%)

Mar. 11 Apr. 11

100

80

0Air India

61.168.1 69.2 66

76.772.1

80.4 79.875.4 71.7

82.178 81.2 78.6

Jet Airways JetLite Kingfisher SpiceJet GoAir IndiGo

20

60

40

SEAT FACTORS OF SCHEDULED DOMESTIC AIRLINES

Total number of complaints (Apr 2011) 1090 Number of passenger-related complaints 2.4 per 10,000passengers carried.

Air India (Dom)

IndiGo

JetLite

Kingfisher

SpiceJet

Go Air

Jet Airways

0 1 2 3 4 5

No.of Complaints/10,000 Pax

1.7

1.7

1.9

2

2.3

2.4

4.1

PASSENGER COMPLAINTS OF SCHEDULED DOMESTIC AIRLINES

New Traffic Data.qxd 5/30/2011 5:08 PM Page 3


POINT OF VIEW

In early January this year, Ulrich Schulte-Strathaus, Secretary General, Association of European

Airlines, made a stinging speech at the Aviation Club in Washington where a large portion of his

remarks focussed on the woes that airlines face in competing with the giants Emirates, Qatar and

Etihad - from the Middle East. Weeks later, the charismatic Akbar Al Baker gave Schulte-Strathaus a

dose of his own medicine with a point-by-point rebuttal that caused waves globally. In the wake of

the Air India strike and the large number of comments on how the Gulf is inundating India, here are

two sides to the picture:

A battle royale

22

ULRICH SCHULTE-STRATHAUS

After a conference I attended recently in Munich,I spoke to the waitress in a restaurant who told meshe would go on vacation to Thailand. I asked whichairline she would fly on, thinking of my memberairlines, of course. She replied that her first choice wasevidently Emirates.

Evidently? Well, in case the news passed you by,in 2009 Emirates became the worlds largestinternational airline, in passenger-km terms. For alarge proportion of European travellers, it offers aone-stop transfer product to allthe major Asian, Australasianand African destinations. And itis growing, massively. Its CEO ison record as saying that itsplanned fleet of 90 A380superjumbos could be increasedto 120 if stand capacity wereavailable at its Dubai hub. And, Isuspect, for the reasons that I explain in a minute,Dubai will certainly accommodate Emirates need foryet further capacity on the ground.

Now in case youre not aware the UnitedArab Emirates has two main commercial centres, theother being Abu Dhabi, just 75 miles away. Each hasits own airline with global aspirations the AbuDhabi carrier is Etihad, smaller than Emirates butgrowing more quickly. These airlines are owned bytheir respective governments, and operated as aninstrument of national strategy (if national is theright word within this regional rivalry), and they areintegrated vertically across commerce, tourism andforeign policy as our Canadian friends haverecently discovered. For them, the airlines are just apart a tool of this vertically-integratedeconomic chain.

But the phenomenon is not restricted to theUnited Arab Emirates. Just up the desert highwayabout 230 miles from Dubai and 185 miles from AbuDhabi is the city-state of Qatar, whose airline also hasglobal aspirations, and is -- you guessed it -- growing.These three airlines have more widebody seats on

order than the entire US industry has in its currentfleet. [Ill pause to let you reflect on that the totallonghaul lift capability of Delta-plus-United-plus-American-plus-Continental-plus-US Airways doesntmatch up to the order book of just these three Gulfairlines]. 425 brand-new longhaul aircraft in the nextfive years where will they fly? The answer, ofcourse, has to be everywhere. Looking to the West ofthe Gulf hubs, we can expect further saturation ofEurope, but also increased penetration of the US

market. And Canada. To theEast, the emerging economicsuperpowers of India and Chinaare obvious candidates, but so,too, are other Asian countries Japan, Korea, Thailand,

Singapore, Malaysia,Indonesia, Vietnam,

Do not impose policies

extra-territorially

CRUISING HEIGHTS JUNE 2011

IATA Robey.qxd 5/31/2011 4:56 PM Page 2


I recently came across the remarks made by Schulte-Strathaus, Secretary General of the Association ofEuropean Airlines, about how global competitionneeds to be addressed by the International CivilAviation Organisation, similar to what the industry iscalling for in the domain of the environment. Hefocussed on the competitive pressure that airlines fromthe Gulf are posing on their counterparts elsewhere.Usually I would choose not to comment directly oncalls to find ways to limit the growth of the Gulfcarriers, including Qatar Airways. However, becauseMr Schulte-Strathaus chose to address one of theaugust forums of aviation visionaries in the world, Ithought I needed to put the record straight.

In his remarks, Mr Schulte-Strathaus included anumber of facts which I beg to disagree with. Thefirst is that the geographical proximity of Doha, Dubaiand Abu Dhabi gives rise to ananomaly in aviation. The fact of thematter is that having a multitude ofhubs in close proximity is common:Paris, Amsterdam, and London;Singapore and Kuala Lumpur; theairports of New York and so on.Therefore, having three major hubswithin a 280 miles radius is not anovelty.

He also raises the issue that thegovernments of Qatar and the UAEconsider the airlines of the Gulf part of nationalstrategy and a tool of a vertically integratedeconomic chain. Again, he is trying to highlighta norm rather than an anomaly in the currentgeopolitical structure. Can he tell me of anycountry of the world which does notconsider its air transport industry, be thatan individual airline or a multitude ofthem, part of national interests? Was itnot the case that the US governmentprovided its airlines with cashoutlays and tax breaks, as wellas war insurance subsidies afterSeptember 11 in order to

ensure the continuity of the US air transport industry?Mr Schulte-Strathaus goes further in saying that

two of the Gulf airlines have never made a profit. Firstof all, I would like to ask him how does he know thatsince Etihad and Qatar Airways are not publishingtheir financial reports as yet? But from the principlestandpoint: If profit was the only reason, why airlinesbuy airplanes, as he is insinuating, then the net resultof buying new airplanes in this industry should havebeen negative during the last decade.

The average age of our fleet is around five yearsonly. We do not keep airplanes operating for 20 to 30years. Therefore, you will find that in order tomaintain the lowest cost in seat mile, and the greatestappeal to customers, our order book is higher thanelsewhere because we maintain a young fleet.

The crux of the matter in what Mr Schulte-Strathaus is saying lies in his remark:These (Gulf) airlines are efficient,they have extremely low unit cost yetdeliver consistently high servicequality. They also have the fullsupport of their domestic politicalinstitutions. I couldnt say thatbetter! Is it a mistake to be efficientand to have a low-unit cost? Is itwrong for governments to besupportive to its national interests? Ishe advocating that airlines which

have high-unit cost and do not deliverconsistently high-service qualityshould be protected from efficientlow-cost and high-service airlines?

Mr Schulte-Strathaus is sayingthat we are driven by a policywhich is not compatible with thatof the US, Europe, Australia,China, Canada, and so on. Imreally lost here! Most of thesegovernments are signatories ofthe Agenda for Freedom

brokered by IATA, which callsfor free market access. In

AKBAR AL BAKER

Europeanairlines should

acceptcompetition





and so on. And, then theres Australiaand New Zealand. And South America.You get the picture.

Here I ask: Does growth of thismagnitude really make sense?

After all, the population of Dubai isjust 2.3 million people, about the size ofPittsburgh and smaller than Baltimore.Qatar, at 1.4 million, is smaller thanProvidence, Rhode Islands metropolitanpopulation, and Abu Dhabi, at just under

900,000, is about the size of Fresno, California orTulsa, Oklahoma. So, again, I ask: Does growth ofthis magnitude make sense? I am sorry toconfuse you, but the answer is a clear yes, and no.But, who am I kidding? This is Washington, wherelawyers and lobbyists I know thats most of you make your living taking both sides or movingbetween them, so yes and no makes perfectsense in this city and this crowd.

The Yes answer is that, yes, it does makesense even for a region with, in global terms, alimited population size, to invest heavily intoinfrastructure, if the investments generate asufficient return. And evidently, the Emirates ofthe Gulf region is satisfied with the value-addedcreated by its investments or believe that in thelong-run these investments will generate macro-economic, vertically-integrated returns of themagnitude sufficient to warrant the investment.

But does it make sense for airlines andtravellers worldwide if three carriers -- two ofwhich have never made a profit -- collectivelycommit $ 100 billion to transforming the aviationmap of the world?

I do not know the answer, but the situation

makes me uneasy. I am not paranoid, althoughthis is an accusation frequently used whenEuropeans speak out about Gulf carrierexpansion. Make no mistake -- these airlines areefficient, they have extremely low-unit costs yetdeliver consistently high-service quality. Theyhave clarity of vision and decisiveness of action.They also have the full and enthusiastic supportof their domestic political institutions.

My point is this: In a market of double-digitgrowth, airlines that have long-haul aircraft fleetswhich dwarf those of their internationalcompetitors are being driven by a policy which isnot compatible with that of the US and Europe,or, I suspect, Australia, China, Japan, Canada,Mexico, Brazil, Chile, Korea and so on. You getthe picture.

How does a European or US airline competein the short- medium and long-term? Or, aCanadian, Japanese, Australian, Brazilian carriercompete?

In the short term, the answer could be to askgovernments to prevent additional market access.But stalling growth opportunities for airlines isnot synonymous for another year gained; it istantamount to another year lost. The purposeof an aviation policy cannot consist of interveningin commercial airline decisions. The purpose ofregulatory activity must be to provide for safety,of course, but also to address imbalances,divergences of policies, and distortions tocompetition.

So the answer is ensuring that thegovernmental policies converge. That should notbe done by imposing ones own policies extra-territorially.

fact, even the Director General of IATA,Giovanni Bisignani, recently called upon theCanadian government to respect the liberalmarket access principle and avoidprotectionism. Does Mr Schulte-Strathausadvocate that this policy of liberalisationshould only apply when his member airlinesare the beneficiaries?

Doesnt Mr. Schulte-Strathaus consider thecontrol over the overwhelming majority of slotsin a highly-congested region a lopsidedsupport to national airlines against newentrants, including airlines, which are comingfrom airports where European airlines canoperate freely, without any reciprocity in termsof slots quality?

Mr Schulte-Strathaus is finally requestinggovernments to prevent additional marketaccess in the short term. Perhaps, he shouldalso ask governments to forego liberalisationpolicies, deregulation and why not foregoingmarket economy and resort to protectionism,inefficiencies, cartel price fixing, and anti-consumer behaviour. Where would

protectionism end if his calls are heeded by thegovernments? Isnt it the right of anyconsumer to get access to the bestprices and the best value for money?

If Europe is not investing enough inaviation infrastructure, and if Europehad developed a cost base, which isbecoming burdensome on some of itsold establishments, and if Europe is notaddressing the cost of its social safety-net in a way which maintains acompetitive posture for its airlines,should then the European consumer bepenalised by depriving him from cost-efficientaviation services? And where does thisprotectionism end? Would the next target be theEuropean low-cost carriers because theymanaged to provide competitive services to themembers of AEA? I believe the answer is clear.

The European airlines were pioneers in alarge number of areas. We in the Gulf airlinescommunity have learnt a lot from them. Theyshould accept competition and the customerbeing in the drivers seat.


FOR ONE, DESPITE THE YO YO NATURE OF THE

RECOVERY THIS YEAR, THE SIGNS ARE GOOD. THE AIR

SHOW ORGANISERS REPORT THAT EXHIBITION SPACE

HAS BEEN FULLY BOOKED SINCE THE END OF

JANUARY THE FIRST TIME THIS HAS HAPPENED IN

THE SHOWS HISTORY, WITH SOME 2,000 EXHIBITORS

SET TO ATTEND. AND THE ORGANISERS SAY THAT

THE SHOW WILL SEE SOME 340,000 VISITORS PASS

THROUGH THE GATES.

So whats the news for Paris?



AIR SHOW

paris airshow.qxd 5/30/2011 5:03 PM Page 2

In terms of commercial news, perhaps the biggest isthat Boeing is not announcing any 737 `replacement`at Paris. It was expected that the Americanmanufacturer would make its proposition known inresponse to Airbus A320neo. Instead it is expected to

clarify its thinking on a 737 successor. Boeing hasntbeen able to make up its mind on a re-engined 737 as ame-too product whose costs are prohibitive. In anycase the timeline for next-generation engine remainscloser towards the end of this decade.

However, a 737 replacement reveals or productlaunch also seems out for the moment. The company hashinted from day one that it would prefer a clean sheetoption to any bid to tamper with the present product.But its woes with the 787 seem to have put any plans toseriously examine the 737 options in the backburner forthe moment. But one thing is for sure, there will beplenty of discussion on the Boeing options at Paris--

Single-or twin-aisle? open-rotors? Much food forthought.

But the Dreamliner scheduled to begin services withANA and Air India later this year will be on display atthe show as will the 747-8I. However both aircraft will bein the static section in keeping with Boeing policy of nottaking part in flying display. Their scheduled appearanceat the Paris air show is also in keeping with its flight testprogramme. Both are behind schedule and are now inthe final stages of their certification process. It is expectedthat they will be cleared for commercial flying closertowards October.

While commercial aviation is improving, the militaryside remains gloomy. Severe cuts in the defence budgetsin the UK, France and other European nations translatesinto far fewer programme opportunities. Across theAtlantic, even in the US, traditionally a high spender,there are now severe difficulties and several proposed


INTO THE SKIES: Visitorswatching the A380 take off atthe Paris Air Show, 2010.





cutbacks and scrapping. The one bright spot is Asia-Pacific and especially India, now involved in a majormilitary procurement spend.

But the US is bringing all its regulars to the air showthe C-17, C-130J, F-16C, F-15E, and E-3 Awacs. At themoment there is no news on the No V-22 or F-35appearance is planned or expected. The F/A-18E/F SuperHornet currently is also not listed to be there, either.

Interestingly with Stealth technology being so muchin the news, its a bit of dampener that both the newstealth fighters taking to the air in Russia and ChinaSukhoi PAK-FA nor the Chengdu J-20 will be makingthe trip to Le Bourget. Though the J-20 was extremelyunlikely, an appearance by the PAK-FA would have beena big plus for theorganisers, it'snot happening.When the MIG-29 first appeared at amajor air show at Farnborough in 1988it created waves and changed theirRussian perception on the display oftheir hardware at air shows.

It is believed that the PAK-FA willmake it first appearance at MoscowsMAKS show in August. Sukhois Su-30Flanker multirole fighter has beenpulled from the show by Russia forunknown reasons after theorganisers previously

announced it would be attending. However the airframerwill still bring its SuperJet 100 airliner along whichhas just entered revenue service.

Another fighter to appear will be the China-PakistaniJF-17 which at Paris this year will take part in theflying display unlike last years Farnborough when itstayed on the ground in static area.

The show will provide the next forum for Dassaultand Eurofighter the two fighters shortlisted for theIndian MMRCA bid to further reaffirm their positionas the best in the business. Both the aircraft are now incombat use over Libya for France and the UK. Theirperformance has been the subject of intense media

scrutiny and both aircraft whilethey have performed creditablyhave been cited for various other

issues. Absent this year willbe the JAS-39 Gripen,

somewhat unfortunatelygiven that the aircraft is making its

combat debut currently as partof the UN Resolution 1973enforcement action in Libya.Also flying will be the Airbus

Military 400M.There are other aircraft that will

AWE-INSPIRING: CamcopterUAV (Unmanned Aerial Vehicle)helicopter in flight.

(Sukhois Su-30 Flanker multirole fighter has been pulled from the showby Russia for unknown reasons after the organisers previouslyannounced it would be attending.


also be around, such as the Pilatus PC-21 and AT802 lightattack aircraft. Also around would be the Aermacchi M-346advanced jet trainer, the C-27J tactical transport and theTiger attack helicopter.

For the first time, the show will see the publicappearance and flying display by the Solar Impulse solar-powered aircraft as its special guest. The prototype,currently a work in progress and undertaking a series ofrecord-breaking flights, will make a public airshowappearance outside home country of Switzerland. Theorganisers say that the Solar Impulse is planned to make a10-15min flight every day weather conditions permitting.

The aircraft has been designed to demonstrate solartechnology by flying continuously day and night on solarpower and solar energy stored in its batteries. SolarImpulses first flight took place in 2009. It has sinceundergone various system and flight tests and been flownthrough a continuous 26-hour-plus period without usingfuel.

This green focus will also be enhanced with a specialpavilion focussed on alternative fuels enabling visitorsto quickly see the main players in one place and helpingothers understand and measure the patchwork approachof biofuel tests and demonstrations underway across thewhole globe.

Another exciting demonstrator to appear at the showwill be Eurocopters X3 compound helicopter. This, too, isexpected to take part in the flying display which, say theorganisers, will see more than 40 aircraft taking part.

One type of aircraft that wont be appearing en massein the flying display yet are UAVs, though the SchiebelCamcopter will return after making its flight debut in the2009 Le Bourget. Though the organisers acknowledge thisis a fast-growing sector, they argue that the smaller UAVsdo not make for an impressive flying display, being too

tiny to awe the crowds stood behind any display line. Anindoor flying display, in the halls, meanwhile would meangiving up valuable exhibitor space. For the larger UAVs,too, there is a problem that of air show restrictions. Thelimited airspace and nearby urban areas means that at themoment it is a no-no. By the time the next generation ofEuropean UAVS and UCAVs appear (for example theDassault Neuron), the show may be able to host unmannedair vehicles.

Some 10m have been spent in refurbishing facilities atthe exhibition centre for this years show as well as 2min upgrading the 350 corporate chalets. While many of thebig companies have given the chalets a go-by the chaletshave been snapped up by SMEs looking to boost theirprofile lure new customers.

But overseas participation will boost the show. ChinasCOMAC, for example, will be making its debut andbringing its model of the C919 airliner to a Western airshow for the first time. All in all, some 200 internationaldelegations are registered and expected to attend.

Meanwhile, the organisers have launched a specialELITE programme for companies to host VIPs in extrastyle and comfort. The ELITE programme, which featureslimited availability, features a fast track entrance, loungearea, unlimited refreshments and a concierge serviceamong other advantages.

For the rest of the visitors, the organisers promiseimproved access at the event, including more shuttle busservices, free WiFi across the show (including a dedicatedsmartphone show site) and free entry to the Air and SpaceMuseum at Le Bourget for visitors.

Finally, they stressed that for the 3,000 press expectedto attend there will be new virtual pigeonholes allowingcompanies to deposit press packs, images and othermaterial online for media.



GLIPMSES OF PARIS AIRSHOW, 2010: (Clockwisefrom top left) Flyingdisplay by the DassaultRafale aircraft; Fouraircraft from the Airbusfamily before take-off; aview of the static displayarea; a spectacular displayby the Eurocopter Tigeraircraft; visit of the FrenchPrime Minister FranoisFillon at one of the standand visitors in front of theUS Department of Defencestand.


2011, which is nothing short of a landmark inthe history of civil aviation it marks thecompletion of a hundred years of civil aviationin India. Incidentally, 2011 in a way also marks10 years of privatisation in the airports

business. Ten years back almost to the day, the GMRGroup received the preferred bidder status forHyderabad Airport, and I feel very proud to have been apart of the team that won the bid from both the centraland state governments.

At the beginning of the new century, the Indianaviation industry was still in a very nascent stage theOpen Skies Policy was yet to be put in place, the airportswere not privatised, low-cost carriers were not presentand the number of commercial aircraft in the countrywere just 113 in March 2001, less than two per cent of thecommercial aircraft fleet in US in December2001!However, for us at GMR, the last decade has indeedbeen a momentous one.

In April 2001, the GMR Group was selected as thepreferred bidder for the Greenfield airport forHyderabad, the capital city of Andhra Pradesh. And thusbegan our journey as Indias first private airportdeveloper, from concept to commissioning. Thechallenge of design and construction of the Hyderabadairport, which would surpass world standards,incorporating the best of technology and environment-friendly features, was completed within 36 months of thefoundation stone being laid. It was a wonderful tributeto the concept of Public Private Partnership initiated bythe Ministry of Civil Aviation.

And in April 2006, we won the bid to develop theIndira Gandhi International Airport at Delhi with a verystiff deadline of commissioning the new Terminal 3. Ourteam rose to this challenge and completed Terminal 3 ina record 37 months, well in time to welcome theparticipants of the Commonwealth Games. I am sure allof you would have entered our country throughTerminal 3 and experienced the world-class facilities thathave been created yet again, through the PPP model.This phase of the GMR journey has enabled to create aresource pool of airport management professionals inIndia.

Now in the year 2011, 10 years after the opening-upof the sector, the Indian aviation scenario is witnessingincredible growth. Indias domestic air traffic grew byalmost 19 per cent post the recession. The DGCA

reported that December 2010 was the busiest month inIndias aviation history, with over five million passengerstravelling within the country for the first time. In fact,Airbus has projected the compounded annual growthrate of Indian domestic traffic at 10.2 per cent per annumtill 2028.

The number of aircraft owned by Indian carriers hasgrown from 113 to 373 in the last 10 years, with ordersfor 292 aircraft and options for another 159 aircraft.Currently, five airports have been privatised by thegovernment Bengaluru, Kochi, Delhi, Hyderabad andMumbai under the Public Private Partnership or PPPmodel. All these have been developed according toworld class standards. We have seen tremendousincrease in terms of service standards in these airports.

THE LAST 10 YEARS HAVE WITNESSED RAPID CHANGES IN THE AVIATION

SECTOR IN THE COUNTRY. KKIIRRAANN GGRRAANNDDHHII BELIEVES THAT THE INDIAN

AVIATION INDUSTRY IS AT AN INFLECTION POINT, AND IN THE NEXT 10

YEARS, AT LEAST 100 AIRPORTS MORE WOULD NEED TO BE DEVELOPED.

Creating the future



INFRASTRUCTURE

KIRAN GRANDHI

Kiran grandhi.qxd 5/30/2011 4:44 PM Page 2

The low-cost carrier model has created a whole newmarket of travellers. Ever since their launch, the LCCscombined market share has gone up from under 10 percent in 2005 to almost 65 per cent by January 2011. Therehas been a substantial increase in bilaterals, withinternational flights tripling from almost 9300 flights inJanuary 2002 to 26193 flights in January 2011.

Even the state-run Airports Authority of Indiasairports are being transformed slowly but surely theongoing modernisation at Chennai and Kolkata airportsare live examples.

Indian airport developers have today gone global toTurkey, South Asia and even Indonesia, and with theexpertise gained, are looking for more suchopportunities across the globe.

Our new airports signify the new India,

cruising_heights_june_2011

Documents

theministry of civil

yearsas aviation

andwhile aviation

ministry of civil aviationand

thesame airline

private airline

dgca doesnt

percent year