SpiceJet to double passenger capacity

New Delhi, May 22: SpiceJet, the country's second-largest budget carrier, celebrated its second anniversary in Indian skies today and said it will nearly double its passenger capacity and fleet size by the end of current financial year.

It is also likely to break even in the first quarter (April to June 2007-08), said company's chief executive officer Siddhanta Sharma. ''We'll be the first of new entrants to achieve this feat.'' The airline has been able to capture a market share of 7.5 per cent, flying 1.5 million passengers in its first year of operations and three million in 2006. This year it hopes to ferry six million travellers.

As part of celebrations marking completion of two years of operations, the airline is offering two lakh seats at a special price of 99 paise for two or more persons travelling together till June 6 on all its non-stop flights covering 14 destinations.

Spicejet intends to add eight more aircraft, including five 211-seater Boeing 737-900 aircraft, by March next year. Currently it has eleven 189-seater Boeing 737-800s.

''By March 2008, we'll have 26 planes,'' said Mr Sharma adding the number will go up to 35 by 2011. ''We hope to add six new destinations and will be operating over 150 flights per day by this fiscal year-end, up from 83 daily flights a day now.'' At present, SpiceJet connects Delhi, Mumbai, Bangalore, Ahmedabad, Goa, Pune, Kolkata, Jaipur, Jammu, Srinagar, Chennai, Hyderabad, Guwahati and Varanasi.

Spicejet plans to increase passenger seat capacity from 15,000 a day to about 27,000 by March 2007. Air Deccan, the country's largest low-cost carrier with 43 aircraft, offers 27,500 seats a day. Started in 1994 as ModiLuft Ltd partnering Lufthansa AG , the airline shut operations a few years later after its German partner walked out. It was later taken over by the non-resident Indian Kansagra business family in 2001 and renamed Royal Airways Ltd, only to be relaunched in 2005 as SpiceJet, a low cost carrier, with more investors joining in.

Despite consolidation and mounting industry losses, SpiceJet says it will not deviate from its existing low-cost model of flying more frequencies on the same routes rather than expanding to smaller stations.

Director Ajay Singh said the airline will maintain a fleet with planes from a single manufacturer, The Boeing Company, to save on operating costs and not foray into cargo or aircraft maintenance repair services.

In January, SpiceJet raised 70 million dollars by selling shares to the Tata group, Goldman Sachs and BNP Paribas to place orders for 10 Boeing 737 aircraft costing 700 million dollars at list prices, which are to be delivered starting 2008.

The airline hopes to tide over losses worth Rs 45 crore last year and expects to break even this financial year by cutting costs. The cost cutting plan includes fuel optimisation by rescheduling cargo weight and the speed at which the aircraft fly.

The carrier recently tied-up with Tata AIG to offer domestic travel insurance at a cost of Rs 129.

UNI