Akasa Plots Larger Fleet, Overseas Flights By Dec

“The market is there and we cannot stop at the order that only gives us line of sight till March 2027. So, before the end of this year, we will place an order that will give us the line of sight till 2030s-plus. It is going to be much larger than the current aircraft order we have placed," founder and chief executive Vinay Dube said in an interview.

Akasa Air currently has an order book of 72 Boeing 737 MAX planes. It launched flights on 7 August 2022, with just two aircraft and has since expanded the fleet to 16.

According to the airline, it will achieve a fleet size of 18 jets this month, far ahead of the March target. “You cannot start an airline with 500 aircraft, so we were cautious. We wanted to grow in a measured manner. The next aircraft order is going to be larger because we can handle higher growth levels beyond 2027. We are looking at just narrow-body aircraft," Dube said.

He said Akasa Air isn’t looking to raise capital at the moment to finance the purchase of new planes.

Consultancy CAPA India– Centre for Aviation estimated that Indian airlines will place orders for 1,500-1,700 aircraft over the next two years, led by Air India and IndiGo. It added that airlines like Akasa Air must place scale bets with new orders with some urgency to secure timely delivery slots and support their growth plans.

For FY24, Akasa Air has decided to induct fewer number of planes compared to 18 between August 2022 and March 2023.

“For FY23, we end with 18; by the end of FY24, we should have 25-30. Induction will be slower for FY24. We designed it on purpose. We decided to have a few months where we don’t take any aircraft delivery," Dube said adding that the plan is to add 12-14 aircraft ever year till March 2027.

Akasa is not immune to the supply chain issues in the global aerospace industry and faces shortage of USB ports, seats, and seat fabric.

However, Dube expects these issues to be resolved by December-end.

Passenger load factor or capacity utilization for Akasa Air increased to 83.8% in December from 52.9% in August, according to Directorate General of Civil Aviation. Its market share rose to 2.3% in December from 0.2% in August. IndiGo is India’s largest airline with a market share of 54.9%.

Akasa is also preparing to launch international operations as Indian civil aviation regulations allow an airline to launch overseas flights after five years of operations, or a fleet size of at least 20 aircraft.

“Subject to all approvals we need to get, it is something that we intend to do. Our intention is to launch international operations before 2023-end," he said.

With its current fleet of MAX aircraft, the airline is looking at 5-6 hour flights from India.

In the domestic segment, the company is building its network around Tier-2, 3 cities as it sees growing air travel demand for smaller cities.

“In the broader context, we remain focused on Tier-2, and Tier-3 cities and connecting them from the metros. That’s definitely where we think the growth would be," Dube added.

The airline currently flies to 14 destinations, including Mumbai, Kochi, Ahmedabad, Chennai, Bengaluru, Varanasi, Goa, Pune, Agartala, Guwahati, Hyderabad, Vishakhapatnam, and Delhi.