Spicejet, first Indian low cost carrier to fly to China

DELHI- SpiceJet became the first low-cost airline to offer flights between India and China on 8 February, when it commenced four-weekly flights on a 3,700-killometre route linking Delhi (DEL) to Guangzhou (CAN). Flights from the Indian capital to the southern Chinese trade hub are served using 737-800 in competition with China Southern Airlines’ 757-operated 10-weekly frequencies.

Following last month’s launch of flights to Riyadh and Dubai, respectively from Delhi and Ahmedabad and a route from Male to Kochi, SpiceJet now operates 11 routes to seven international destinations from six airports across India. Dubai is now connected to four Indian cities by the low cost carrier. The total number of passengers on international routes consequently has increased by over 80% in 2012.

On the domestic front, the carrier recently opened services from Chennai  to Mysore (via Bangalore) and from Pondicherry to Bangalore in Karnataka. It also launched flights from Tiruchirapalli (Tamil Nadu) with Chennai, Delhi and Mumbai Domestic market share in December 2012 increased to 19.20% from 16.80% in December 2011.

The last quarter of 2012 saw SpiceJet turning a profit of US$ 185 million for the quarter vs a loss of US$ 0.71 million in the same period of the prior year.

Neil Mills, Chief Executive Officer, said "To announce a profit for the third quarter in the current challenging environment is a huge achievement and clearly demonstrates that the strategic changes that SpiceJet have made in the last two years has created a platform for future success of the company."

This result was achieved thanks to better fleet optimization, an altered route mix (thanks to more international flights) and higher yields. Fuel cost as a proportion fell to 45% of the total revenue in the current quarter against 50% in the comparable quarter of the previous year. Revenues for the third quarter ended December 31, 2012 increased by 37% while average passenger yields in the quarter increased 29% as compared to the corresponding quarter a year ago, reflecting in the reduction in capacities in Indian domestic routes, especially with Kingfisher pull-out from the market.

Sourced: TravelDailyNews