AirAsia India set to begin with 5 aircraft, in first quarter

Just as Ratan Tata had dreamt of making the Nano a family car, especially for families compelled to travel on two-wheelers, the Tatas’ low cost aviation venture, AirAsia India, a joint venture between Air Asia Bhd (49 per cent), Tata Sons (30 per cent) and Telestra Tradeplace (21 per cent), will target “first-time travellers”, AirAsia India Chairman S. Ramadorai told Business Line in an interview.

Compared to the Tatas’ other aviation venture, Tata-SIA, this budget airline, which will operate point-to-point flights mainly from Tier-II Indian cities, has been slower on the takeoff. “But the moment the clearances come, we have done all the background work and will be ready to take off immediately.”

This budget airline, he says, should be ready to operate flights by the “first quarter of 2014, or even by February or March if the clearance comes”. The airline is yet to get the operating permit from the DGCA.

Asked if the Tata ethos of not paying speed money had slowed down the venture, he said, “Let it slow down; the moment the approval comes, we’ll take off. In the first year, we will operate five aircraft.”

The main objective of this airline, said Ramadorai, is to make air travel affordable to people… families, particularly first-time (air) travellers.”

Asked if it is possible to be low-cost and profitable he said, “Yes, our hubs will be there only in smaller cities as bigger cities are more expensive. And we are already in talks with various State Governments and have requested them to consider certain things.”

These include lower fuel taxes, “a State subject, and certain other facilities at the airports from where we’ll operate.”

On the likely numbers the fledgling airline will handle in the first year of operations, Ramadorai said: “Our goal is clear, we want to provide affordable air travel, bring in first-time travellers and we want families to travel by our airline. How or what this scales up to, we’re not worried about.”

The point to point flight will be relatively short haul “60-90 minutes, max”, he added.

On why the Tatas would choose an IT man (he retired as TCS CEO in 2009 after a stint of 37 years in the company and continues to be its Vice-Chairman), Ramadorai said: “As in everything else, they wanted somebody they can trust… somebody who would be suitable, not necessarily somebody who knows the business. That, you can pick up anyway, but somebody who could be counted upon for ethical conduct…to present the right face and a clean image.”