A month ago, we reported about the up and coming new airline Akasa, with Vinay Dube at the helm. Since then, Rakesh Jhunjhunwala, the Indian big bull, has come forth to confirm that he is indeed interested in picking up a 40 percent stake in the airline promoted by Vinay Dube, who was previously working with Delta, before heading to Jet Airways as CEO. His last assignment was with Go First (earlier GoAir), where he lasted only six months in 2020.
Akasa is intent on bringing the Ultra-Low Cost Carrier Model to India as per current reports. I am not sure how this will work out for them, given the lack of secondary airports in India for now, and also the grey area in Indian flight rules where a certain minimum is expected to be offered to all passengers as a package rather than piecemeal.
As per a news report from MoneyControl, Akasa intends to bring back the old band of Jet Airways management at Akasa. Here are some of the old Jet Airways hands who are talked about as being a part of Akasa,
- Bhavin Joshi (Finance and Leasing)
- Anand Srinivasan (Chief Information Officer)
- Praveen Iyer (Chief Commercial Officer)
- Belson Coutinho (Head Marketing)
- Adam Voss (Engineering)
- Ajit Baghchandani (Inflight services)
- Capt. Floyd Gracious (Operations)
Akasa planning to induct Boeing 737 MAX Aircraft
Given the aggressive timelines of Akasa, intending to start operations by early 2022, the airline needs to earn early slots for their aircraft. Per various accounts, the airline intends to induct between 70 to 100 aircraft within the first five years, to be a formidable force in Indian aviation. The airline is, hence, considering inducting a fleet of Boeing 737 MAX aircraft. There are many reasons to do so.
Firstly, apart from SpiceJet, Vistara, Air India and Air India Express, Boeing does not have commercial airline customers in India, with only SpiceJet being a customer with a big outstanding order for now. All the other airlines have built their narrow body operations around the Airbus A320 family (including Go First, Vistara, IndiGo, AirAsia India and Air India). The Boeing 737 MAX is clearly of no interest to SpiceJet for now, who is currently using the pandemic as an opportunity to stay away from their big order book.
As a consequence, Akasa’s big order may be welcomed by Boeing, both in terms of pricing discounts they may be willing to offer, as well as regulatory support that may be extended. India and China are after all the only two major markets where the aircraft has not secured regulatory approval for operations at the moment. Not just that, the aircraft company may have a glut of a few 737s which were produced during the past couple of years while the aircraft grounding was in force, and either the airlines went belly up or their interest in the aircraft waned because of their own finances.
Not just that, the Indian market has evolved, and Sale and Leaseback Transactions are more common now than when IndiGo made its business plans and implemented them rigidly.
The Akasa airline has started to prepare for an imminent launch, and has already informed the regulator that it intends to bring in Boeing 737 MAX aircraft in its fleet. That should be a good news for Boeing, who otherwise had largely seen only wide body customers in India.
What do you think of Akasa’s fleet plans with the 737 MAX?
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