SpiceJet expands internationally with 2 new destinations

Bangkok: SpiceJet is planning to add two new overseas destinations to its international network this fiscal, after becoming the first airline to connect Pune with Bangkok through a daily flight. Before March 2014, Dammam and Kuala Lumpur will also have SpiceJet flights besides an increase in frequencies on some existing international routes. With this planned expansion, SpiceJet would raise its foreign flights per day from 28 to about 42 this fiscal.

International expansion is crucial for the loss making airline since this helps it increase aircraft utilisation - it can use idle aircraft at night. As per the airline’s annual report for 2012-13, it is banking on increased international footprint this fiscal to take on competitive forces and possible capacity addition in the domestic market. The airline, which has seen most performance parameters improve in 2012-13 versus the previous fiscal, plans to take seven more Boeing 737NG aircraft this fiscal and expects a majority of the capacity increase to be deployed in the International markets, for which it says it has already secured rights.

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In the annual report, SpiceJet has noted that while the industry outlook for 2013-14 looks a bit challenging, SpiceJet’s international focus will deepen. “This will result in additional aircraft utilisation and secure better yields. This will also offset the risk of infusion of additional capacities into domestic sectors.”

[caption id=“attachment_85165” align=“alignleft” width=“380”] SpiceJet plane is seen in this file photo Reuters[/caption]

Speaking after the launch of daily flights from Pune and Bengaluru to Bangkok this morning, Senior VP (Commercial) V Raja said “We are going to start operations to Dammam and Kuala Lumpur within this financial year. We are currently working on the financial details and also trying to increase frequencies to certain existing destinations.”

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Raja said SpiceJet was also looking to induct a strategic partner. Asked whether SpiceJet was in talks with any foreign carrier, he said these were “only reports” but added that “if there is a good proposal which is economically and commercially good for us, it will be wrong not to look at it.”

In the recent past, SpiceJet, which is promoted by the Kalanithi Maran’s Sun Group, is rumoured to have discussed alliance possibliities with Qatar Airways and TigerAir,SpiceJet’s increased international focus comes when new competition is emerging in the domestic market, most notably through AirAsia India which is also going to be based out of Chennai and may begin operations early next year. But unlike SpiceJet, AirAsia will not be able to fly abroad since Indian laws do not as yet allow overseas operations before completion of five years of domestic flights by any airline.

As of now, IndiGo is the only other LCC besides SpiceJet which flies overseas.

SpiceJet’s international footprint is quite large. The airline says in its annual report that 2012-13 saw a major change in its strategy international operations because before that, international operations were were limited to Colombo and Kathmandu. Last fiscal, SpiceJetlaunched flights to Dubai, Kabul, Male, Riyadh, Guangzhou and Sharjah.

The new routes launched were Delhi-Dubai, Mumbai-Dubai, Ahmedabad-Dubai, Cochin-Dubai, Delhi-Kabul, Cochin-Male, Delhi-Riyadh, Delhi-Guangzhou, Varanasi-Sharjah, Lucknow-Sharjah and Madurai-Colombo.