Rakesh Jhunjhunwala-owned Akasa Air, on Monday, secured its no objection certification from the civil aviation ministry and hopes to start operations next summer.
A NOC is the first step towards the start of the operations and the airline will now have to apply for the Directorate General of Civil Aviation for its operations permit. Incidentally the NOC was issued a few days after Jhunjhunwala’s meeting with Prime Minister Narendra Modi.
Akasa Air has been promoted by Vinay Dube, former CEO of Jet Airways. Former CEO of IndiGo Aditya Ghosh too is associated with the venture.
While Jhunjhunwala has invested Rs 247.50 crore in the airline, another big name of Dalal Street, Madhav Bhatkuly, founder of investment fund New Horizon, has also invested around Rs 6 crore in the company.
Akasa Air plans to offer flights across India starting in the summer of 2022 with an endeavour to be the nation’s most dependable, affordable and greenest airline, the airline said in a statement.
“Akasa Air will serve all Indians regardless of their socio-economic or cultural backgrounds with warmth, inclusiveness and respect. Because at the end of the day, it is these qualities that connect people and cultures and help Indians realise their dreams,” CEO Vinay Dube said.
The airline is in talks with US aerospace company Boeing for buying up to 100 737 Max aircraft. Airbus too has pitched its narrow body Airbus A320Neo aircraft. Airbus Chief Commercial Officer Christian Scherer recently told PTI that the plane maker is in conversation with Akasa for an aircraft procurement deal.
The airline has put together a management team in place. While promoter Vinay Dube is the CEO, Praveen Iyer will be the Chief Commercial Officer. Iyer, a former colleague of Dubey at Jet Airways, is one of the founding members of the team along with Neelu Khatri who has been appointed as head of corporate affairs and was most recently
president of Honeywell Business in India.The company hired Ankur Goel, former head of IndiGo’s treasury and investor relations, as its Chief Financial Officer.
Sources aware of Akasa’s plans said the airline intended to place bulk aircraft orders and scale up to at least 20 aircraft in the first year of operation. He pointed out that scaling up fast would be crucial in order to compete with incumbent players such as IndiGo. Market leadership gives pricing power to control fares which favours the market leader and can be damaging to a new operator.
“ A number of airlines in India went bust because they did not have the right leadership. This is not the case with Akasa Air which is led by industry veterans such as Dube and Ghosh. There is buoyancy in the market which the airline can capitalize upon. Jet Airways’ closure created a room for a new pan India airline and Akasa Air could get the first mover advantage,” said aviation expert Manoj Chacko.
