Date:08/03/2006 URL: http://www.thehindubusinessline.com/2006/03/08/stories/2006030803600900.htm

Back GoAir may tap pvt equity to purchase new aircraft

Our Bureau

Mumbai , March 7

GoAir, which recently announced the acquisition of 20 Airbus aircraft, is considering various options including private equity to finance the purchase.

Mr Jeh Wadia, Managing Director, GoAir, said, "We have been receiving a number of enquiries from private investors, but have not yet made a final decision on the way to go."

Mr Wadia was speaking at the launch of the airline's low-fares challenge that promises to reimburse passengers, who book cheaper tickets on competition, twice the difference between the fare quoted by competitors and that available on GoAir. It also commits to foot customers' cancellation charges.

The low-fares challenge, which commences on March 9, is restricted to routes operated by a jet aircraft and for flights that take off soon after or before a GoAir flight on a given sector.

According to Mr Wadia, the challenge aimed to simplify the decision making process for customers, currently requiring to choose between various schemes such as the check fares and dyna fares offered by airlines.

GoAir, promoted by the Wadia family, operates with three leased aircraft. It plans to have a fleet of eight aircraft by the year-end, and 33 by end-2008. The airline will expand its route network from April with the launch of flights on the Mumbai-Delhi, Mumbai-Srinagar, Srinagar-Jammu, and Chennai-Delhi sectors, taking the number of daily flights to 28.

Load factor on the airline is currently at 68-70 per cent, Mr Wadia said. He added that the airline was in talks with a number of other low-cost carriers such as Air Deccan, Kingfisher, and Indigo to create an association, to air the industry's needs, share engineering and technical services, transfer passengers on each other's flights in case of cancellations, and share Government infrastructure where required.