Mumbai: India's oldest privately run airline, Jet Airways (India) Ltd, is readying plans to fly non-stop to select US destinations, potentially rivalling competitor Kingfisher Airlines Ltd's ambitions of flying directly to San Francisco from Bangalore and Mumbai by the middle of this year.
State-owned airline Air India has already started non-stop operations to the US from Mumbai and New Delhi.
Exploring options: Jet Airways chairman Naresh Goyal. (Photo: Ramesh Pathania/ Mint)
International airlines such as Continental Airlines Inc., American Airlines Inc. and Delta Air Lines Inc. too operate non-stop flights to the US from Mumbai and Delhi.
The total market size on the India-US sector is more than 2 million passengers and, with the introduction of long-haul planes by Boeing Co. and Airbus SAS, the world's two biggest plane makers, airlines are increasingly offering direct flights to the world's largest economy.
Jet Airways had in 2007 established the European city Brussels as a hub for offering various onwards connections from there to North America. The Mumbai-headquartered full-service airline is also in the process of setting up another hub in the Chinese city of Shanghai or other South-East Asian countries for connecting North American cities to expand its international operations.
“Jet Airways will be deploying (Boeing's) B787 aircraft or A350 type planes (made by Airbus). The airline is currently finalizing its non-stop long-route strategy,” said a person close to the development, adding that discussions are on with Airbus.
Jet Airways has placed orders for 10 Boeing 787 aircraft that are scheduled for delivery between July 2011 and December 2012.
The business model of Jet's competitor Kingfisher Airlines, its chairman Vijay Mallya has said, is to have all non-stop flights with no hubs in any European or South-East Asian country.
A Jet Airways senior executive declined specific comment on the airline's non-stop flight plans. “We are exploring all available options including non-stop and hub-based operations. If non-stop makes sense, we will seriously examine it,” said Wolfgang Prock-Schauer, chief executive officer of Jet Airways India.
According to Aniket Mhatre, an analyst with broking firm Prabhudas Lilladher Pvt. Ltd, the non-stop flights plan by Jet Airways will help it dent the differentiator that Kingfisher and Air India have by way of their service offerings.
"They (Jet Airways) will be having hubs for more connections to various parts of the world and also have a non-stop product in lines with Air India and Kingfisher Airlines," Mhatre added.
Another expert cautioned that Jet Airways would have to contend with high costs of operating hubs in addition to the proposed non-stop flights, but added that it could manage. "Though it is tough to fill up the long-haul planes, Jet has the financial muscle to develop a hub in Europe as well as offering a non-stop product to the US. By the time Jet starts the non-stop flights, it will be developing two hubs,” said an analyst at a foreign brokerage, who requested not to be identified, citing company policy.
Kingfisher Airlines has already placed orders for long-haul planes such as A380s, A340s and A350s, while Air India is in the process of acquiring Boeing planes such as the B787, popularly known as Dreamliners, and B777s.
“Jet's entry into the India-US sector with non-stop product will add to the competition and will lead to a fare war. Already, yields are under pressure with the existing carriers doubling capacity (on the sector),” said S. Venkat, executive director, finance, of National Aviation Co. of India Ltd, which runs Air India.
Kingfisher executives were not available to comment on Jet Airways' plans.
Jet Airways currently operates a fleet of 76 planes connecting 59 destinations with more than 365 flights daily. It connects international destinations such as New York (both John F. Kennedy and Newark airports) Toronto, Brussels, London (Heathrow), Singapore, Kuala Lumpur, Colombo, Bangkok, Kathmandu, Dhaka, Kuwait, Bahrain and Muscat.