Covid-19 impact: Vistara to review delivery schedule of aircraft

NEW DELHI: Tata SIA Airlines Limited, which operates Vistara, is in the process of reviewing delivery timelines for a $3.1 billion jet order it placed in 2018 amid a fresh wave of covid-19 cases worldwide that is likely to delay recovery of international travel, the airline's chief commercial officer Vinod Kannan said on Wednesday.

"We are not cancelling orders but reviewing the timeline of deliveries and delivery schedules," Kannan said at a media briefing adding that the airline will end the current fiscal with about 48 aircraft in its fleet, compared to 42 at the end of last fiscal.

Kannan said he won't be able to immediately ascertain the impact of fresh lockdowns, initiated by some European countries, on the airline's aircraft delivery schedule.

During 2018, Vistara had placed a huge order of aircraft worth $3.1 billion from Airbus SE and Boeing Co, which consisted of Airbus 320/321 and Boeing 787 (Dreamliner) planes, with deliveries slated between 2019 and 2023.

The airline currently has 43 aircraft in its fleet, including 33 Airbus A320, two Airbus A321, six Boeing 737-800NG, and two Boeing 787-9.

"We were supposed to have three to four widebodies (Boeing 787) by now but have just two," Kannan said adding that the airline remains optimistic about its domestic operations despite a slowdown in international business which would result in lesser international flights in coming days.

Domestic air passenger traffic showed a gradual recovery in September, registering a growth of about 37% over August, but was 66% lower on year due to the pandemic, according to data from civil aviation watchdog Directorate General of Civil Aviation (DGCA).

Vistara hopes to operate up to 100% of its pre-covid capacity on domestic routes by March-April 2021, Kannan said.

"We are currently deploying about 55-60% capacity or 110-120 flights daily compared to 200 daily flights earlier (before the pandemic)," Kannan said adding that passenger load factors however remain depressed at about 60%-70% compared to 80%-90% during the year-ago period.

"International travel will depend on other countries' views of allowing people to come in. (We) hope regional (international) travel to open up in another five to six months," Kannan said.

Capping of fares by the government, however, remains a cause of concern among airlines amid the pandemic which has hit business hard. The government has extended the cap on domestic airfares till 24 February.

"It's unfortunately or fortunately what it is. On certain peak days we could do better without fare caps," Kannan said.

On the domestic front, the lack of corporate and business travellers, traditionally high value airline customers, are likely to pose a challenge for Vistara as it sets its sight to increase its domestic operations during the coming months.

"We have some business travel coming back from smaller businesses but overall corporate and business travel haven't picked up yet," Kannan said, adding that the airline is encouraged by general positive uptick for air travel amidst the pandemic.

On Wednesday, Vistara released its customer survey, conducted between 17 August and 2 September, which stated that the trend of people flying to visit friends, family and relatives is expected to rise in the coming months while a spike in leisure travel is only expected by 2021 due to the pandemic.