The Hindu Business Line : Air One to raise $20 m to fund fleet acquisition

LOW cost airline Air One, which plans to start feeders operations from August, said on Tuesday that it plans to raise over $20 million over two years to fund its acquisition of aircraft.

The airline is in talks with a few financial institutions in India and abroad to raise the funds through debt. The airline expects to post revenues of about Rs 40 crore from each aircraft.

The Air One Managing Director, Mr J.W. Lobo, told newspersons that five out of the 25 Embraer aircraft that it plans to acquire in two years will be through the leasing route, while the rest may be bought.

In its first year of operations, the airline will take two 50-seater Embraer ERJ-145 on lease from Swiss International Airlines. The lease rental for each of the first two Embraer is about $1,35,000 per month.

Mr Lobo said the airline would connect second tier cities to the metros directly. For example, there will be direct flights between cities such as Bhubaneshwar and Pune to Bangalore.

Mr Lobo said the airline will have three types of fares and they will be 30 per cent lower than the fares of other airlines.

The aircraft will have two-plus-one seating arrangement and fly mostly in the mornings and evenings. The tickets can be booked through the Internet, at the airline's offices and through travel agents.

Mr Lobo said the airline would be able to offer tickets at lower costs as it expects passenger load factor at about 80 per cent. "There is no other way can an airline offer cheaper fares," he said.

Rolls Royce will provide maintenance of aircraft and will set up infrastructure in Bangalore for this purpose.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Air One to raise $20 m to fund fleet acquisition

Ennore Port hopes to wipe out losses — Centre may disinvest stake next financial year

Mercator raises $60 m through FCCB issue

Record handling of bulk iron ore lumps at Chennai port

TNT Express begins `Mango Bytes' service

Delhi Metro Rail to prepare detailed report for Chennai

Wagon investment scheme facilitates assured supply of rakes to customers