Less than a month ago, Vistara, the joint venture between Tata Sons and Singapore Airlines, became eligible to fly overseas following the induction of the 21st aircraft into its fleet. Without wasting any time, the airline yesterday announced its biggest deal with aerospace majors Airbus and Boeing - a $3.1-billion (Rs 21,332 crore) deal for 13 A320 neo aircraft and six B787-9 Dreamliners. With the purchase order in place, Vistara now aims to start international operations this year itself.
"We hope to fly international by December 2018. We are in the process of seeking necessary permissions from relevant authorities. Our international operations will start off with short-haul international routes," Leslie Thng, the airline's chief executive officer, told Mint.According to him, Vistara's next phase of growth is "categorized into different buckets". The Airbus fleet, for instance, will handle the airline's domestic and short-haul international routes. "This will help Vistara expand both within and outside India and on all routes that this aircraft could support us on," said Thng, adding, "If you look at the number of narrow-body aircraft we are bringing in, you will realize that we have an intention to expand our domestic footprint."
Indeed, the airline has increased frequency out of Delhi in the last couple of months as well as upped the number of flights from Bengaluru and Chennai. According to the CEO, expanding the domestic network will be key to Vistara's international success.To begin with, Vistara will focus on regional and South-East Asian destinations - places that are three to five hours away, which is the A320's range limit - and will reportedly look at code-share with like-minded partners. Obviously, Singapore Airlines, a very strong player in South-East Asia, would be one of them.
"For medium to long-haul destinations, we decided that Boeing 787-900 (Dreamliner) would be the best for us," said Thng. "Once we induct Boeing 787, it will give us a lot more opportunities to carry out expansion," he added. The airline hopes to start medium-haul operations from 2020.Given that India is the fastest growing aviation market, competition is rapidly intensifying but Thng believes there is place for new players, too, and expects Vistara to notch up "a decent market share". He also acknowledged that the capital will continue to be Vistara's main hub even after international operations kick-off, but is not ruling out secondary hubs. "We are looking at other opportunities and business cases to set up a secondary hub outside Delhi," he explained.
He further told the daily that the spiralling fuel costs and the depreciating rupee - down about 8 per cent in the year so far - has hiked up the airline's operating costs. "Internally, we are looking at ways to increase revenue and at the same time be more cost-competitive. We do engage in fuel hedging, so that helps to mitigate some of the increase in costs," he said.The buzz is that Vistara is mulling introducing a premium economy section in its international flights. So Indians can look forward to more choice in international travel in the near future.