No-frill carriers mull buying smaller aircraft

New Delhi:  With the government focusing more on improving regional connectivity, no-frill carriers have started thinking of buying smaller aircraft with IndiGo even evaluating launching a regional subsidiary, a leading aviation consultancy firm has said.

"IndiGo is also evaluating the possibility of placing an ATR (turboprop aircraft) order to establish a regional subsidiary," the Centre for Asia Pacific Aviation (CAPA) said in a latest report.

While all major no-frill carriers -- IndiGo, SpiceJet and GoAir -- have either Boeing or Airbus narrow-body aircraft fleet, all of them have started considering acquiring smaller aircraft like turboprop ATRs or Bombardier's Q400s.

"SpiceJet remains undecided on whether to exercise its options for a further 15 Q400s, however CAPA expects that the carrier will increase its regional fleet in due course," the study said, adding that GoAir "is also considering inducting turboprops to serve Tier-II and Tier-III cities".

While IndiGo now has around 30 Airbus A-320s from its 2005 order still to be delivered, it will start to take delivery of the first of its 150 A-320neos, as well as 30 A-320s from 2016-17.

SpiceJet has 30 Boeing 737-800s on order with deliveries set to commence from next year, the CAPA report said, adding that a further narrow-body order "may be finalized by early April after a new investor comes on board".

The B-737 MAX was "the most likely equipment" for SpiceJet, it further said.

Similarly, GoAir would see its fleet size increase from 13 to around 20 aircraft over the next couple of years, to be followed by the first of its 72 A-320neos on order from 2017.

CAPA said several of Air India's "small" regional fleet, comprising a mix of regional jets and turboprops, are dedicated to operations in the Northeast and there was "no clear market proposition. Against this backdrop of capacity stagnation, Air India's competitors are set to expand aggressively," it said.

Source:  http://economictimes.indiatimes.com