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Vistara sees 'steady return in demand'; to increase daily flights to 100

Prior to the nationwide lockdown, which resulted in the suspension of scheduled domestic as well as international flights, Vistara was operating over 200 flights to 34 destinations daily

BusinessToday.In | Sunday, September 20, 2020 | 21:18 IST

Vistara, with a "steady return in demand", will increase total daily flights to 100 from 80 by the end of this month and along with its peers is in discussion with the government for "cohesive solutions" for the pandemic-hit domestic airlines' industry.

Prior to the nationwide lockdown, which resulted in the suspension of scheduled domestic as well as international flights, Vistara was operating over 200 flights to 34 destinations daily.

Vistara CEO Leslie Thng said that the airline will be scaling up its existing operations to 100 daily flights by month-end from 80 at present.

Thng, in an e-mail interview, said the airline saw most of the pent-up demand in the first few weeks of resumption of domestic air travel.

In the wake of the pandemic, scheduled domestic services were suspended from March 25 to May 24 while international flights continue to remain suspended except for those operating under bilateral air bubble agreements. Besides, flights approved by aviation regulator DGCA are also operating in the Indian skies.

While demand is still far from pre-COVID levels, it is improving consistently which is an encouraging trend, the CEO said, adding that "while on some routes the traffic is still one-directional, we are largely observing a steady return of demand, especially to major metro cities".

The airline has already started operating special flights between Delhi/Mumbai and Dubai, and between Delhi and London Heathrow.

"We are reviewing the opportunity to operate similar flights to Paris and Frankfurt as well," he said.

"In the short term, of course, the situation affects our ability to expand, given the various factors including restrictions on capacity deployment, lower demand on most routes and border closure. However, the consistent return of confidence in customers gives us hope," he said.

The global aviation industry, including airport operators, are navigating strong headwinds due to the slump in demand for air travel amid the pandemic resulting in lockdowns, curbs on movement across borders and economic disruptions. Some international carriers have gone belly up and many are in a bad financial situation.

Indian carriers are also grappling with financial woes, forcing them to go for salary cuts and even layoffs.

Earlier this month, Minister of State for Civil Aviation Hardeep Singh Puri said Indian airlines have sought an interest-free credit line of at least USD 1.5 billion.

"Together with other airlines, we are in discussion with the government authorities for cohesive solutions for the industry and are hopeful of favourable outcomes," Leslie said.

As far as Vistara is concerned, he said, "we are sufficiently funded for now. Our parent companies are committed to Vistara and remain confident of our growth strategies." Vistara is a joint venture between Tatas and Singapore Airlines.

According to reports, the full-service carrier's pre-tax loss widened to Rs 1,814 crore in 2019-20 from Rs 831 crore in 2018-19, mainly due to higher operating costs.

Vistara has customised its Business Continuity Plan (BCP) to deal with the challenges posed by the COVID-19 crisis.

"To steer through the difficult times, we have been pursuing several measures to reduce non-customer facing operating expenses and are making every effort to conserve cash wherever possible," Leslie said.

These measures include renegotiating various contracts with partners, vendors, and lessors.

"The crisis has impacted every business in the aviation ecosystem, and it is time to be more understanding and empathetic towards each other," he added.

To a question on whether the airline sector may see some consolidation in the face of the current situation, Leslie said, "Consolidation is not a new concept in Indian aviation, but we are all hopeful of better times to return". 

(With PTI inputs)

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