IndiGo CEO Ronojoy Dutta on Wednesday said a new Air India under the Tata group would be a real challenge while new airline Akasa Air would be a much less competitive force for the next two-three years. Akasa Air, which is backed by former IndiGo chairman Aditya Ghosh, veteran investor Rakesh Jhunjhunwala and former Jet Airways CEO Vinay Dubey, on Monday received a no-objection certificate (NOC) from the civil aviation ministry.
“Akasa is a very less competitive force now or for the next two-three years. They have to slowly grow and move, get slots, get planes. They are not going to come out of the box, eager to leave. Slow build up. “And against that, I think we have good defenses. We are the lowest cost carrier. “It will be difficult for anyone to reduce their cost from us,” Dutta said in a pre-recorded interview at an event organized by aviation consultancy firm CAPA.
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Whatever the number one looks at, “we’re running a great airline” with very low costs and a great network, he said. “In the midst of the Covid-19 pandemic, we opened nine new domestic stations,” said Dutta.
“So, for a new entrant, it will be tough to compete with us. But (new) Air India – this is the real challenge for us.” On October 8, the government announced that Tata Sons’ wholly-owned subsidiary Tales Pvt Ltd had defeated a consortium led by SpiceJet promoter Ajay Singh. By offering Rs 18,000 crore to win the bid to acquire debt-ridden Air India.
Dutta said Air India will be a strong force under the Tata group and IndiGo does not take it lightly at all. “Internationally, they will be a strong competitor. Domestically, they now have three carriers – Vistara, AirAsia India and Air India – all grouped together. In this case, they will have a tough competition. I see him as a formidable force,” he said.
Dutta said that IndiGo is currently operating around 85 per cent of its pre-Covid domestic flights and about 40 per cent of its pre-Covid international flights. “We are not growing much in the next 18 months. After that, we start growing,” he said.
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