January 18, 2018 TnH Global

AirAsia India on course to break-even; to treble headcount by 2020

No-frills carrier AirAsia India plans to triple its head count to over 4,800 by 2020 from 1,612 in 2017 as it seeks to spread wings to international skies besides expanding domestic operations, a top executive has said. The Tatas-AirAsia-run airline is also looking to break even by this December or early next year, managing director and chief executive Amar Abrol said. The Bengaluru-based budget carrier will be completing four years this June.

“In 2017, we had 1,612 employees, which we plan to take to 2,569 this year and 3,684 in the subsequent year. By 2020, we expect to have 4,834 people working for us,” Abrol told PTI during an interaction here last evening.

He said most of this hiring will be made for pilots, cabin crew, and ground operations, which account for almost 95 per cent of the total workforce.

“There will not be much hiring in the back office or at the headquarters or in the strategy section, but largely it will be for aircraft-related functions,” Abrol added. According to Abrol, the airline is also likely to double its passenger traffic to 8 million this year from almost 4 million in 2017.

“We expect this number to go to 12 million in 2019 and by 2020, we hope to fly 15 million,” he added.

AirAsia Group chief executive Tony Fernandes has already announced a public float f0r the India joint venture wherein his group control 49 per cent. He had also said the airline would seek board approval to appoint investment bankers for the share sale process. Abrol also said the airline will further consolidate its presence in the domestic market prior to taking wings to international skies early next year. He said entering the key Mumbai sector remains on the cards but slots and infrastructure are a constraint.

“Obviously, we’ll come to Mumbai, there are no two ways about it. Certainly Mumbai is on the cards, and it will happen soon rather than later,” he said.

Yesterday, he had told PTI that the airline would get its 21st plane by the yearend, which enable them to go international in 2019. Stating that this year his focus will be more on domestic consolidation and aggressive route expansion.

“From six stations about 18 months ago to 16 destinations today, we have grown very rapidly. We will be launching a few new stations but not too many. The idea is to increase the frequency and to increase the depth rather than the breadth,” he said. The airline currently operates 104 flights per day to 16 destinations with a fleet of 15 A320s.

“With the induction of 15th plane recently, we will scale up the number of services to 125,” he added. Also, during January-September 2017, the airline added almost one aircraft per month on an average and this year also the strategy will be pretty much the same, he said, adding, “we will be adding two new aircraft by March.”

Abrol said the airline is looking to break even by the end of this year, and it is moving in line with the plan submitted to the board in April 2016. “We should be looking at break even towards the end of 2018 or maximum it can stretch out to early 2019. The plan is pretty much the same that we had submitted to the board in 2016,” he said.

In the September 2017 quarter, the airline had massively narrowed its net losses to Rs. 16.4 crore form against Rs 62.12 crore a year ago, on a revenue of Rs 395 crore, which rose from Rs 175.13 crore a year ago. Ruling out any capital raising plans at this stage, Abrol said the airline is adequately funded right now and in case of a requirement, it will approach the board.

“In March 2016, the board pumped an additional USD 51 million into the airline, so we are adequately funded now. But as and when we need money, we will approach the board and will certainly get it. But the intention is to generate enough cash and sustain operations on our own and that is what exactly we are doing today,” he said.

News Source: PTI