The airline has grown to connect 20 destinations within 24 months and is gearing up to fly overseas after the delivery of its 20th aircraft in 2018. Phee Teik Yeoh, CEO, Vistara, informs that they are working on a global network through interline and code-share agreements for maximum visibility.
Q. What have been the highlights in the past year?
Our efforts in 2016 continued to revolve around delighting our customers by driving innovation in our value proposition and the expansion of our operations. Vistara launched six new destinations in 2016, namely Jammu, Srinagar, Kochi, Chandigarh, Kolkata and Port Blair. And, as soon as the New Year began, we announced two new destinations, Amritsar and Leh, taking the total count of destinations served to 20 with over 500 weekly flights. There isn’t a bigger testament to this success than winning the trust of close to 4 million customers in just 24 months. The year 2016 also witnessed the launch of our first ever multi-media brand campaign, ‘Fly the New Feeling’ with Bollywood’s most loved actor, Deepika Padukone, as our brand ambassador. Helping us maintain our consistency in delivering operational excellence, we received the Category III Bravo (CAT III-B) certification from the Directorate General of Civil Aviation (DGCA). Passenger Load Factor in 2016 was highest at 85 per cent in December while the BOM-DEL route was the highest revenue earner for the same month.
Q. What are your plans for expansion of networks?
Vistara has always believed that growth must be measured and sustainable, which forms a combination of customers’ demand, commercial viability and mandatory obligations. We have grown to connect 20 destinations across the country in only 24 months, and we are gearing up further to add five Airbus A320 neos to our fleet in the next financial year. We have recently announced the addition of two new and exciting destinations — Amritsar and Leh, along with an increase in frequency in some of our existing routes.
Q. When will we see Vistara serve international destinations?
Our 20th aircraft is expected to arrive by June 2018, which would make us eligible to fly overseas, a dream that we have been very vocal about since Vistara’s inception. We are working on our plans and strategies to prepare ourselves for the complexities that flying overseas would bring along and the magnitude of work this would require. We’re also simultaneously working on building a network of global partners with interline and code-share agreements, which is helping us a great deal in spreading awareness about our unique products and services outside the Indian borders. Our international plans are being developed in full swing and being refined to be presented to the board for their advocacy. We will be getting more clarity once the plans are finalised.
Q. Since the airline is yet to break even, what strategy are you banking on?
With so many unique customer value propositions, and as the list continues to grow, it is evident that we’re approaching the market very differently. It may be right to say that we’re not chasing the competition, but creating a unique space for ourselves. Our unflinching commitment to the sector and air travellers is clearly based on a long-term vision. As a new entrant in the aviation sector, we believe in challenging the status-quo in the market to disrupt and bring the ‘new feeling of flying’ to our customers, which would eventually help us get where we want to reach (in terms of gaining market share).
Q. What are some of the challenges that need to be addressed?
A major challenge plaguing the growth of the Indian aviation sector is the lack of better infrastructure. India’s existing aviation infrastructure is soon reaching a saturation point. We would like to see a growth in airport capacity and deployment of new technologies for better handling of more flights/increasing number of flights. We also need to identify and address other choke points, such as parking bays and check-in counters. The airport infrastructure in India needs a long-term vision, backed by adequate central assistance, which will fasten its development. Moreover, the shortage of slots at several Indian airports and hoarding them by some airlines to prevent new airlines to grow is another big challenge. An equitable distribution of slots amongst all airlines based on genuine demand in order to provide all players a level-playing field would be for the greater good of the industry. Furthermore, the cost of doing business in India has also continued to rise. Jet fuel prices and airport charges have recently increased, while state taxes on ATF have not been reduced in several states. Having said that, we are glad that the government has taken note of these significant challenges and introducing measures to harness the growth potential of the sector. The National Civil Aviation Policy has acknowledged some of these issues and is a right step in the right direction. We’re hopeful that some of these issues will be addressed soon, as India gears up to surpass Japan to become the world’s third largest domestic aviation market.
Growth Story: Vistara has recently announced the addition of Amritsar and Leh, Ladakh services to its network.