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Aviation in 2008: Mallya has hands full amid mergers
The Indian civil aviation sector is heading for an exciting time in 2008 and the New Year could prove to be a turning point for many players, reports Lalatendu Mishra.
The Indian civil aviation sector is heading for an exciting time in 2008 and the New Year could prove to be a turning point for many players. Aviation and liquor czar Vijay Mallya will continue to dominate the civil aviation space by piloting the Kingfisher Airlines-Deccan merger and enabling Kingfisher to fly to the US, amidst stiff opposition from one of Mallya's arch rivals and a section of decision makers in Delhi.
Mallya will have to dedicate a sizeable amount of his time and money for his aviation business, as 2008 is a crucial year for his now badly bleeding two airlines. Captain GR Gopinath, the erstwhile poster boy of Indian aviation, will embark on the second phase of entrepreneurship creating something equally challenging in the aviation space.
Naresh Goyal's Jet Airways will make history by flying into the lucrative West Asia sector. Its planned foray into Chinese, South African and Australian markets would make it more of an international carrier, putting it in the big league of top airlines in the world. In 2007, Jet Airways became the first private sector airline from India to fly into the US, as well as built Brussels as its European hub. Its subsidiary JetLite is also likely to yield synergistic benefits apart from improving yield.
National carrier Air India has bought a sizeable new fleet. It is going through integration with Indian Airlines. The year 2008 could be a turning point for the Maharaja. It is scheduled to go public and will have a new chairman to spearhead growth.
In the ongoing consolidation, two low-cost carriers — SpiceJet and IndoGo — appear to be emerging as real winners.
These two will have a fleet of more than 20-24 aircraft each and will have a combined market share of little more than 20 per cent, giving the full service carriers a run for their money. SpiceJet is set to turn into profit in 2008.
