SpiceJet eyes more hubs for Bombardier run

Low-cost air carrier SpiceJet plans to open two hubs — one each in the southern and western parts of the country — as part of the second phase of expansion of its regional operations through Bombardier aircraft.

“We will have only one base for the first five airplanes but two more bases, which would be only in a metro city, will be added for 10 more. One of the bases could be Chennai and the other would be in Gujarat,” said SpiceJet Chief Executive Officer Neil Mills.

“In a later period, we may also look at adding one more base in the northern part of the country,” he added.

The airline has announced to start regional operations with the 70-seater Bombardier Q400s from next month. The first base of the regional operations is in Hyderabad and will connect Aurangabad, Bhopal, Indore, Mangalore, Rajahmundry, Tirupati and Vijayawada. It has ordered 30 planes with Bombardier — 15 fixed and 15 on options.

SpiceJet is to get the first plane next week and 15 planes before July next year. Mills said these planes could be utilised for up to 11.5 hours a day and would constitute around 40 per cent of the total operations at a later stage.

“The biggest benefit of these smaller planes is that jet fuel for them comes at only four per cent tax and the airline does not have to pay landing and parking charges to the airport. This venture will start paying from the second year of operations,” he said.

Even as the airline focuses more on the expansion of the regional venture, it will also be adding five more Boeing 737s in its fleet by May next year. “We have increased our Boeing fleet from 22 to 30 in the last nine months and will add five more till May next year. But the regional operations will see more growth during the coming period,” said Mills.

The Gurgaon-based carrier aims to have a fleet of 70 aircraft, a mix of 45 Boeing and 25 Q400 planes, by the end of 2013.

SpiceJet reported a net loss of Rs 71.9 crore in the first quarter of the financial year because of high oil prices. The company had closed the corresponding period in the last year with a net profit of Rs 55.2 crore.

On Friday, the airline’s stocks were up by 7.02 per cent to close at Rs 22.10 a share on the Bombay Stock Exchange.