Air Asia-led joint venture could face regulatory challenges: CAPA

Govt has not clarified whether it will clear the licenses or not

Air Asia-led joint venture in India could face regulatory challenges, says Kapil Kaul of Centre for Asia Pacific Aviation.  Air Asia announcement on expected lines and not surprising.

However, surprised with TATAs agreeing to be part of the JV without  taking a lead role in the consortium. This will be a Air Asia led consortium which might face regulatory challenges.

"It is not  clear if government will clear their license as there is no clarity on the issue of new licenses," he said.

Air Asia announced today it is applying to foreign investment promotion board to invest in a joint venture in partnership with the Tata group and Arun Bhatia of Telestra Tradeplace.

Air Asia is the second foreign airline to express interest in investing in India after Abu Dhabi's Etihad Airways. Last year government liberalised norms to allow foreign airlines to invest upto 49% in the sector.

Air Asia

^{First flight to India :  Trichy in December 2008}

^{Flies to :  Chennai, Trichy, Kochi, Thiruvananthapuram, Bangalore and Kolkata}

^{Weekly seat capacity (non home markets)  :  India - 20,500. Macao - 22,680, Vietnam - 25,560, Hong Kong - 28,800, China - 47,612}

^{Fleet - 117 airbus A320s. (Air Asia X which flies  medium and long haul routes has 9 airbus A330s)}

^{Aircraft on order - 475 including the A320neo}

^{Destinations - 85  (Air Asia X - 12)}

^{Passengers flown ( first three quarters 2012) - about 25 million. Air Asia X - 1.91 million}

<sup>Note: Air Asia X is a separately owned long haul carrier of Air Asia group. It used to fly to Mumbai and Delhi Air Asia Group includes its airlines in Malaysia, Thailand, Philippines and Japan.  2012 statistics do not include data from airlines in  Japan and Phillipines which were launched last year

source -company, CAPA</sup>