Vijayawada-based regional carrier, Air Costa, will be launching its services to new destinations other than Delhi as soon the pan-India license is issued by the Directorate General of Civil Aviation (DGCA).
“Delhi will have fog between November and January which creates operational issues for the airlines. For a new carrier like ours it would be better to avoid the risk and wait a little while for the launch of services to the national capital, “Captain K N Babu, chief executive officer of Air Costa told Business Standard.
Air Costa is expected to get the license by mid-November, 2015 according to its CEO. The grant of license was taking a little longer than was promised by the Ministry, apparently because the airlines has again been subjected to the security clearance owing to some old rules.
The airline CEO said they have been collecting the data on various sectors as they would be launching the services to destinations that are financially promising once the pan-India permit was issued.
The company, which owns a fleet of four Embraer aircraft, is currently operating services connecting 9 cities including Jaipur, Ahmedabad, Hyderabad, Bengaluru, Chennai and Coimbatore.
Under the existing licensing rules a pan-India license holder should have 5 aircraft under its control . However, this condition is said to be removed in the new draft rules being framed by the Civil Aviation Ministry. “As per the existing rules an airlines shall have 5 aircraft within one year of the grant of pan-India permit. We will be adding the fifth aircraft any way,” Babu said.
Earlier this year the company said it enjoyed monopoly on three city pairs-Jaipur-Chennai, Tirupati-Visakhapatnam and Vijayawada-Visakhapatnam sectors duopoly on five others. The average utilisation of E-170 aircraft was 10 hours and the average utilisation of the E-190 was 14.5 hours each day which is the best in the industry.
The company had achieved a break-even within 14 months from the launch of services in October 2013. It had achieved an operational profit of Rs 1.5 crore in December last year, according to the company officials.
Air Costa is a part of LEPL Group, which has interests in real estate power and infrastructure development. The group had recently announced a residential project featuring 3 towers ranging from 19 to 27 floors near Vijayawada.
