“Civil aviation regulator DGCA has approved flying permit of the airline today following examination of documents and multiple test flights, ” a person aware of the development said.
The airline aims to start flights by this month with two ATR-72 aircraft. It has won rights to operate flights from Sindhudurg, Jalgaon, Nanded and Agatti Lakshadweep to Bengaluru, Goa, Hyderabad and Pune under the government’s regional connectivity scheme.
The airline is owned by Harsha Raghavan, the former head of Fairfax India, businessman Chenna Reddy and Manoj Chacko, executive vice president of WNS Global. Reddy and Chacko were earlier associated with Kindfisher Airlines.
The airline will have the new Goa airport built by GMR as its main base.
Raghavan and Chacko’s company Just Udo Aviation Private Limited is the parent company of the airline and has raised capital of Rs 200 crore. “That is enough for a small airline which is looking at measured growth,” the person quoted above said adding the airline’s operation is being modelled on the lines of IndiGo or Air Arabia which have one of thr lowest cost of operation. Chacko had earlier told ET that the airline is planning to induct six aircraft in the first year. “We are aiming to be an airline which provides last mile connectivity and connecting remote locations which doesn’t have infra for an Airbus A320 or Boeing 737 aircraft. From Goa one can connect multiple destinations which are in the range of an ATR aircraft,” Chacko had said.
The history of Indian aviation has not been kind to regional airlines with them shutting shop after a few years of sustaining losses. Some airlines like Truejet, Pegasus have shut down despite well-funded promoters backing them.
Experts say that this happens as regional airlines fail to scale up quickly facing competition from mainline airlines which have a bigger business and hence a lower unit cost.
“Adequete capitalisaion with proven and qualified management has been lacking in regional airlines which hinders growth of regional carriers, ” aviation consultancy firm CAPA said in a report.
Airlines run in losses during the first few years as there is a high cost of setting up operations which doesn’t get covered rapidly.
Akasa Air which has been funded by late billionaire investor Rakesh Jhunjhunwala registered loss of Rs 623 crore in its first year of business.
Fly91, Chacko said, will not look to into direct competition with mainline carriers will like to have codeshare and interline agreements with them. “We will have an open API for our system. Any airline in the world which doesn’t fly to a remote airport will be able to tie up with us to provide last mile connectivity to their customers on a single ticket,” Chacko said.
Except IndiGo and SpiceJet, no Indian airlines have a fleet of smaller turboprop aircraft and can be a potential partner.
