New Delhi: It may be surprising that GoAir is content to operate only a boutique domestic airline when new players are entering and rivals are placing record aircraft orders. But it is tough to doubt the results of the strategy. In an interview with Roudra Bhattacharya, GoAir Chief Executive Officer Giorgio de Roni talks of how the airline is in line to record strong profits. Edited excerpts:
Go Air has had two years of profits while most airlines are in losses. What is your outlook for this financial year?
Last year we were profitable, but it was limited due to the huge increase in fuel costs and the significant depreciation of the rupee. This year will be much stronger. We are much better placed than last year in forward bookings for the fourth quarter.
Overall the financial year has been good. We have deployed 20 per cent more capacity and have increased passengers by 24 per cent. Yields have gone up little but I would have expected more. We are slightly below 40 per cent increase in revenue and now we enter the last quarter, which normally isn’t the strongest but we are confident of delivering profit for the full year. I don’t see any reason not to maintain profitability also due to the much lower cost of fuel.
IndiGo is sharply increasing capacity sensing growing demand. What are your plans?
The first availability for A320s reasonably is beyond 2019 and certainly we are considering what could be the scenario beyond 2020. I don’t think we will go for additional aircraft before that, but we should be flexible enough to take up opportunities in case of significant changes in the competitive scenario. If needed we can always lease aircraft, but we are right now working on the budget for the next financial year and it is based on 19 aircraft.
24/01/15 Roudra Bhattacharya/Business Standard
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Go Air has had two years of profits while most airlines are in losses. What is your outlook for this financial year?
Last year we were profitable, but it was limited due to the huge increase in fuel costs and the significant depreciation of the rupee. This year will be much stronger. We are much better placed than last year in forward bookings for the fourth quarter.
Overall the financial year has been good. We have deployed 20 per cent more capacity and have increased passengers by 24 per cent. Yields have gone up little but I would have expected more. We are slightly below 40 per cent increase in revenue and now we enter the last quarter, which normally isn’t the strongest but we are confident of delivering profit for the full year. I don’t see any reason not to maintain profitability also due to the much lower cost of fuel.
IndiGo is sharply increasing capacity sensing growing demand. What are your plans?
The first availability for A320s reasonably is beyond 2019 and certainly we are considering what could be the scenario beyond 2020. I don’t think we will go for additional aircraft before that, but we should be flexible enough to take up opportunities in case of significant changes in the competitive scenario. If needed we can always lease aircraft, but we are right now working on the budget for the next financial year and it is based on 19 aircraft.
24/01/15 Roudra Bhattacharya/Business Standard
