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Tata Sons, Singapore Airlines JV Vistara set to spread wings to foreign shores, to put plan before board

by December 21, 2016 General
V Vistara will induct the twentieth aircraft – A320Neo – and the full service airline will be eligible for flying on the international routes after that.

Vistara, the joint venture airline firm of Tata Sons and Singapore Airlines, has put in place a concrete plan for its international operations which will be presented before the board in the next couple of months for approval, Phee Teik Yeoh, the ariline’s CEO told FE. He said that once the plan is approved funding will also be tied up.

“We have had several rounds of discussion and are very close to presenting the full-fledged plan which is going through the final changes. It is not yet approved by the board and the promoters. We are coming close to finally present it to the board and thereafter we can get the funding that is required,” Phee Teik Yeoh said.

Vistara will induct the twentieth aircraft – A320Neo – and the full service airline will be eligible for flying on the international routes after that. The management is also working on finalising the code sharing partnerships with foreign airlines cutting across continents.

Phee Teik emphasized on presenting a credible plan to the board and the promoters which will be done shortly and the current focus was to expand the domestic operations and prepare in every possible way for the international operations.

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Vistara got its CAT 3B certification this year, and the airline will induct its first A320 Neo aircraft in April 2017. The management expects the airline to get approval for the safety management system from IOSA which is a must for airlines before starting the international operations.

“We have launched a slew of ancillary products and services and continue to strengthen not just the operations but also the customer value proposition. So that by the time the international operations starts Vistara will be ready for the tough competition that will lie ahead,” added Phee Teik.

For its domestic operations, Vistara operates 12 aircraft and the next 7 will arrive by June 2018. Network expansion is also on the anvil and with the increase in fleet size the full service carrier may look to open another base besides New Delhi. With the CAT 3B licence this year, Vistara will be more equipped to tackle the fog that engulfs north Indian cities during winter months. Hence, operating efficiency will improve significantly.

The airline has interline tie-ups with 14 international carriers and the management is trying to get code sharing arrangements with airline across the globe like Jet Airways. According to experts, international operations are always more profitable so it makes sense for Vistara to start flying abroad to improve its finances.

“We are not looking at one particular continent for code-sharing but are looking for partners across Europe, North America and Africa.

The foreign carriers already know about the service that Vistara provides for the customers, so a lot of them want to partner us, though we have 14 interline partnerships with international carriers starting with Singapore Airlnes,” added Phee Teik Till March 2016, the Vistara registered a revenue of R715 crore and made a loss of R415 crore.