Air Deccan to expand beyond south

To enter the trunk route market by June

The country's first no-frills flier, Air Deccan, is gearing up to spread its wings beyond regional sectors.

The airline plans to start operating on countrywide trunk routes from June 2004, which will bring it in direct competition with Jet Airways, Indian Airlines and Air Sahara.

"We have major expansion plans and are going to increase our operations four times by April 2004. The airline is also going to break the image of a regional low-frills airline and enter the trunk route market," Captain GR Gopinath, managing director, Air Deccan, told Business Standard.

To be able to fly on long-haul routes such as Delhi-Mumbai, Delhi-Bangalore, Chennai-Delhi, Air Deccan plans to acquire aircraft of higher seat configuration than the ATR Turbo Prop it now operates.

The airline is in talks with aircraft manufacturing majors Airbus and Boeing to lease four planes for the long-haul operations.

Gopinath added that the airline would stick to its current pattern of charging about 50 per cent lower than a normal economy class tickets for the new destinations. It will also extend its current ticket booking facility on internet to these routes.

The airline will also beef up its current fleet of four ATRs to 12 by April 2004. By January 31, Air Deccan will have 70 flights daily as compared with the current 25. Daily Mumbai-Belgaum, Mumbai-Goa operations will begin by December 31.

The company is lining up investments from Golden Ventures Ltd, a Mauritius-based NRI venture for financing the foray into the trunk routes.

The NRI group will pick 20 per cent shareholding in the company for a consideration of Rs 18 crore, of which Rs 2.6 crore will be equity, while the balance will be the premium on the shares issued.

The local promoters are also infusing close to Rs 7.12 crore of equity into the company. As a result, the total paid up capital of the company will increase from Rs 2.08 crore to around Rs 13 crore.

By April 2004, Air Deccan plans to increase operations to 100 per day by entering the North Indian market also.

To begin with, the airline will operate on regional sectors using Delhi as the hub for flights to Dehradun, Amritsar, Agra, Jaipur and Udaipur.