Maran’s Spice to buy 30 Bombardiers for $900 mn
03 Nov 2010
SpiceJet, the low-cost airline now largely owned by media baron Kalanithi Maran, will spend $900 million (Rs994 crore) on buying 30 Bombardier aircraft to enhance regional connectivity in the country.
The Gurgaon-based airline said on Tuesday that it plans to launch a regional airine connecting India's fast-growing non-metropolitan cities to metros - signalling the return of business confidence in the aviation sector, which faced turbulent times after the 2008 economic crisis triggered a decline in passenger traffic.
"The strategy is to access tier II and tier III cities, which we have struggled to connect with our existing fleet because the runways in non-metro cities are shorter and cannot be used by bigger aircraft Boeing 737s.
Two different types of aircraft will help the airline to access 100 airports, well over the current 37 airports. There is a huge opportunity as far as the smaller airports are concerned," said Neil Mills, who took over as chief executive officer of the airline last month.
''We believe that the enormous potential in the Indian domestic market can be further tapped by enhancing regional connectivity in the country by focusing on tier II and tier III cities,'' Mills added. The decision would be enhanced by an aggressive addition to the SpiceJet fleet to double it from the current 22 aircraft by end-2013.
According to Mills, the 2004-founded company has selected Q400 NextGen turboprop aircraft from Bombardier Inc, Canada, and the deliveries would start from the second quarter of 2011. ''The SpiceJet board today approved an order of up to 30 aircraft with deliveries commencing second quarter 2011 and we are in the process of obtaining the necessary regulatory approvals,'' Mills said in New Delhi.
''At the end of the quarter (ended 30 September), SpiceJet has a positive net worth and over Rs600-crore cash,'' Mills said.
During the quarter, the airline, a reincarnation of ModiLuft, started its first two international flights - from Delhi to Kathmandu and Chennai to Colombo.