Unperturbed by rivals having higher pie of the domestic traffic, SpiceJet said it would not “go crazy” about market share and the focus is on remaining profitable in a responsible manner. Scripting a turnaround with seven straight quarters of profit after being on the verge of closure in late 2015, SpiceJet is currently fourth in terms of domestic market share after IndiGo, Jet Airways and Air India.
Asserting that SpiceJet would not “go crazy” about its market share, Ajau Singh, CMD, SpiceJet, said the focus is to grow in a responsible way and remain profitable. “Market share will happen as we increase our planes and flights,” he noted.
As per the latest data available with aviation regulator DGCA, SpiceJet is at the fourth position with a market share of 12.8 per cent, a notch below national carrier Air India which had 12.9 per cent share at the end of November 2016. During the same period, rival IndiGo’s market share touched 42.1 per cent while that of Jet Airways stood at 14.9 per cent, excluding JetLite which had a share of 2.4 per cent.
Referring to SpiceJet’s financial position before he took over the reins in January 2015, Singh claimed that the airline now makes around INR 1 crore every day.
“We are concerned about our profitability. Since January 2015, in 680 days that the airline has been with us we have made profit of INR 1 crore everyday. If you look at 2014, for 365 days, the company lost nearly INR 3 crore a day,” Singh claimed.
In the 2016 July-September period, the airline had posted its highest-ever quarterly profit of INR 59 crore. In the year-ago period, the same stood at INR 29 crore.
To a query on whether the airline’s business model has changed since he took over the reins in 2015, Singh said that while the business model inherently remains the same, now it is “much more conscious about cost”.
Singh mentioned that Boeing extended support when the airline was facing rough weather in 2014, including by way of refunding some advances that were made towards aircraft purchases. “Boeing played an important role in assuring lessors that SpiceJet would remain flying. They also supported us financially. In those difficult times, Boeing offered very strong support to SpiceJet and they played very incredible part in what you call turnaround or revival story,” he noted.
SpiceJet has also saved on expenses by reducing costs related to engineering and maintenance costs, and airports, among others. Embarking on expansion plan, the airline has inked a deal worth INR 1.5 lakh crore with Boeing for buying up to 205 new planes.
(PTI)
