Mumbai: Andrew Cowen, chief executive officer of Saudi Arabia’s newest low-fare carrier Sama Airlines, is betting big on the India-Saudi route with cheap fares and value-added services.
As the founder of consulting agency Mango Aviation Partners Ltd, Cowen had earlier advised budget carrier GoAir and says he has great respect for Air Deccan founder G.R. Gopinath and his business model. Cowen has also been a finance and strategy director at British budget airline Go Fly Ltd and senior finance manager (Americas) for British Airways.
Taking wing: Sama Airlines CEO Andrew Cowen. The airline on Wednesday launched flights connecting Dammam and Mumbai. Daniel Hambury / Bloomberg
Sama Airlines on Wednesday launched flights connecting Dammam and Mumbai. Cowen spoke with Mint on the sidelines of a party in Mumbai. Edited excerpts:
A downturn is gripping the aviation industry worldwide. Was it a wrong time to start India operations?
In fact, this is a very good time, the reason being there are very few direct flights to Saudi and they are too expensive. This is because there is no competition in this route. Currently, the fare of India-Saudi route is five times higher than any other route that has more competition.
What is your USP?
We are offering fares that are 75% cheaper compared to many other traditional carriers. When legacy carriers are finding excuses for pushing fares up, we are offering year-round low fares to create a new set of passengers. We are offering fares of Rs3,000 for one-way travel, excluding taxes and surcharges.
Any plans to lift the fuel surcharge, like AirAsia has done?
No, not at this moment. Lifting and imposing surcharges will confuse travellers. Moreover, the downward trend in crude oil prices is yet to be established.
Apart from low fares...?
A series of value-added services are in the pipeline. For example, we are introducing a simple frequent-flyer programme: keep the boarding pass of nine flights, and the 10th will be free. We have special onboard toilets for females, considering the Islamic population. Apart from special check-in counters for passengers with less baggage, we are also offering travel insurance, which is totally Sharia (Islamic religious law) compliant.
Air India Express is offering food even though it is a low-fare carrier. You are not.
We want to keep our cost to the minimum and to avoid wastage in terms of food.
But you still have older aircraft?
Yes. When we conceived the concept of Sama two years ago, prices of new planes were too high. It makes no sense to opt for new planes. So we leased old planes. We are now considering inducting new planes since prices have halved in the last 18 months.
What market are you targeting?
We are equally targeting the labour market and professionals. Approximately 1.6 million Indians live in Saudi Arabia and (there are) 1.2 million travellers a year. This is just the tip of the iceberg. We are also expecting 20% of our travellers would be Islamic pilgrimage groups.