Air-India is drawing up plans for a second round of fleet acquisition, even as its initial Rs 10,000 crore (Rs 100 billion) fleet expansion plan awaits clearance from the government.
"The second round of aircraft acquisition will be aimed at increasing the number of long-range and mid-range aircraft," V Thulasidas, chairman and managing director, Air-India, told Business Standard.
The Air-India management has appointed an internal group to finalise the second fleet acquisition plan and the proposals are expected soon. The group will study the market situation and will finalise the size of the acquisition as well as the type of aircraft to be bought.
After the two rounds of expansion, Air-India's fleet strength is expected to go up to 60-70 aircraft. "We have been adding new services as well as enhancing existing ones. For this, we will need to have a larger fleet," Thulasidas said.
In the first round of expansion, Air-India is to add 28 new short and long-range aircraft to its fleet by 2007-08. For this, the airline would raise funds from international financial institutions and will not depend on government funding, he said.
"Funds are not an issue with us. It will be easy for us to raise funds from international financial institutions for this. Once we get the go-ahead from the government, we will start the process," he added.
Air-India recently expanded its fleet strength by inducting 14 aircraft -- three Boeing 747-400s and eleven Airbus 310s -- on dry lease. Air-India is further proposing to take two more Boeing 747-400s on dry lease -- one in June 2004 and the other in October 2004. These aircraft are being dry leased for commencing flights to Los Angeles on the US West Coast.
Besides, the airline is also adding more international destinations on its map. As a part of this plan, Air India will provide service from smaller Indian cities to Europe, the United States, the Middle East and Southeast Asia.
Fleet expansion
- The second round of aircraft acquisition will be aimed at increasing the number of long-range and mid-range aircraft
- In the first round of expansion, Air India is to add 28 new short and long-range aircraft to its fleet by 2007-08
- After the two rounds of expansion, Air India's fleet strength is expected to go up to 60-70 aircraft
- Air India is currently taking aircraft on dry lease
