Following the return of Boeing 737 Max planes to Indian skies, SpiceJet is looking to not only expand its passenger operations but also its cargo services, both domestically and internationally, airline officials aware of the plans told Moneycontrol.
The airline plans to induct 50 Boeing 737 Max planes by December 2023, chairman Ajay Singh said.
Twenty additional cargo planes will be added in the next two years, the officials said. The airline may spend $2.5 billion to $3 billion to expand its cargo operations over the next few years, the people added.
“A fleet of 10-12 widebody planes and 10 freighter versions of narrow-body planes will be sufficient to expand our cargo operations in the next two years, over and above the 17 aircraft we currently have in our cargo operations,” a senior SpiceJet official said.
“The cargo business is growing very rapidly and we are looking at all opportunities to raise funds to grow this business quickly, and that includes selling a stake,” Singh said.
As part of SpiceJet’s cargo expansion plans, the airline will create a network for domestic and international operations. It may set up loading docks and storage facilities in India, the officials said.
The airline is targeting expanding its cargo operations to the US, Europe, Southeast Asia and Africa using its fleet of widebody aircraft.
“Currently, we are experiencing a lot of demand for cargo operations from Vietnam, Hong Kong, China, Sri Lanka and the Maldives and we plan to create a stronghold in these markets before expanding to other international destinations,” another official said.
For India and neighbouring countries, the low-fare carrier plans to use its narrow-body planes primarily for cargo operations. The airline is also targeting the government’s Krishi Udan 2.0 scheme to expand cargo operations domestically.
SpiceJet 2.0
After a difficult few years for SpiceJet following the grounding of its Boeing 737 Max planes and the outbreak of the pandemic, the airline is once again exploring ways to expand its presence in Indian skies.
The carrier has agreed compensation from Boeing for the grounding of 737 Max jets, Singh said at a press conference on November 23. Boeing’s 737 Max planes were grounded globally in 2019 after two of the aircraft crashed.
SpiceJet aims to cut liabilities by as much as $300 million over six months, raise funds from banks, potentially consider a warrant issue and induct 50 Boeing 737 Max planes in its fleet by December 2023, Singh said.
The airline has started flying two Boeing 737 Max planes in India and 11 more such aircraft will start flying over the next 15-20 days, Singh said.
Singh said SpiceJet will induct 155 Boeing 737 Max planes as quickly as possible.
“We are looking to replace our current fleet with the new Boeing 737 Max planes,” he said. “Despite Boeing 737 Max not operating in India for over two years, we do not expect there to be a shortage of pilots to fly the 737 Max planes. All our pilots are trained to operate such aircraft.”Pilots will have to undergo an eight-hour training programme to learn the operating system of the new Boeing 737 Max planes, followed by simulated test flights and actual test flights before they will be ready to operate commercial flights, a senior company official said.
Source : Money Control
