New Delhi: Singapore Airlines has an open mind on potentially bidding for Air India Ltd, making it the first foreign airline to join a bunch of firms interested in acquiring India’s national carrier.

“I think Singapore Airlines has an open mind. It really depends eventually on whether there is a business case. I don’t think we know enough at this moment," Leslie Thng, chief executive officer of Vistara, a joint venture between Tata Sons Ltd and Singapore Airlines, told reporters at a press briefing.

Prior to his current assignment, Thng was CEO of Singapore Airlines-owned regional carrier SilkAir. He has a three-year term as CEO of Vistara.

Both the Tata group and Singapore Airlines have attempted to take over Air India in the past and are seen as potential bidders for the debt-laden airline.

Air India has a strong brand presence globally, said Thng.

“If you look at the history, Air India was in fact one of the pioneers in many of the aviation launches. Air India actually has a very good reputation in some of the markets. People know about Air India—there are a lot of NRIs (non-resident Indians) who live overseas, who know about Air India. It flies to many international destinations. The brand awareness of Air India is not weak," he added.

In October, Tata Sons executive chairman N. Chandrasekaran said the Mumbai-based group is considering buying Air India but had abstained from commenting on the position of Singapore Airlines.

The government has hired EY to advise it on the Air India sale process, which is likely to take about 6-9 months.

Meanwhile, Vistara will make its international debut later this year. The airline, which operates 17 Airbus A320 aircraft, will see three more aircraft join the fleet by March, followed by one each in May and June.

The airline will go international in the second half of 2018 after it is designated as an international carrier by the government and wins flying rights. It plans to fly on routes that already have flights as also to new cities where there is a business case.

These would be to destinations in West Asia and Southeast Asia, allowing the company’s A320 planes to fly without refuelling. “We want to go farther but for that we need other vehicles," Thng said, referring to wide-bodied planes.

Vistara plans to look at medium-haul operations or flights of 5-9 hours over the next three years. Flights to Europe qualify as medium haul. Ultra-long-haul flights, to destinations such as the US, are far off, said Thng.

“Ultra-long-haul is even more challenging. We are still a relatively small and young airline. We don’t have the resources and the capability to do many things at one time," he added. “We want to be a true global international airline. The question is when and how."

Vistara will also expand its domestic network over the coming years so that it can feed its international network. The airline plans to fly to Chennai from next month.

In November, the airline defaulted on regulatory guidelines that mandate it to fly a certain portion of its flights to under-penetrated regions in the country, according to the Directorate General of Civil Aviation (DGCA). The airline, however, does not plan to buy regional planes and, if required, will tweak its network to meet the new guidelines.

“The new guidelines came into force in the winter of this year. For Vistara, we have been purchasing (regional seats from other airlines) since the beginning of 2017 under old guidelines. We have submitted our position to the ministry and we are talking to DGCA in terms of fulfilling our shortfall," Thng said. “If required, we will have to make changes to our network."

Vistara, which came in for praise in a parliamentary panel report on Friday that was otherwise unusually scathing on the airline sector, hopes to narrow its loss this fiscal from Rs518 crore in the previous 12 months.

“We are not satisfied with the RASK (revenue per available seat kilometre) we are generating at the moment. We are working very hard to improve. It is improving but it is not improving at the pace we would like. If our RASK doesn’t improve, we will not be able to see light at the end of the tunnel (profitability)," he said.

The airline’s application to join airline lobby group Federation of Indian Airlines (FIA)—IndiGo, SpiceJet, Jet Airways and GoAir are members of this grouping—is still pending, Thng said.

FIA had opposed its entry three years ago and approached the courts challenging the government’s decision to allow it.

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