The Hindu Business Line : GoAir to sign $40 m pact with Air France Engg

The Wadias-promoted low cost airline GoAir is set to sign a six-year contract with European MRO (Maintenance Repair and Overhaul) major, Air France Engineering, worth $40 million for maintenance and overhauling services of 40 aircraft.

The airline had last week signed a LoI with the European MRO company, following which the two will sign a full contract within the next few days. Earlier, it had a similar arrangement with Singapore-based SIC, which ended recently.

Mr Edgardo Badiali, the airline’s Chief Executive Officer, said the contract was for $20 million for 10 aircraft and $40 million for 20 aircraft for a period of six years.

On GoAir’s expansion, he said the slowdown in the industry would not impact the airline’s fleet expansion programme, as it was conservative and calculated when initiated. It has seven aircraft, out of which three are on lease.

By June 2009, it will acquire four A-320s, which will replace the leased assets, taking its own fleet strength to eight. “With these inductions, the average age of our fleet will come down to six months, which is the youngest in the industry,” he said.

The company has placed orders for a total of 20 Airbus A-320s, which will join the airline’s fleet in a phased manner by March 2012. “We are sticking to this schedule,” he said.

Mr Badiali said the airline was sharpening its focus on corporate travellers. With Indian corporates tightening their travel budgets and middle-level executives being encouraged to take to LCA flights to cut costs, GoAir sees in this an opportunity to attract corporate travellers.

“We will come out with a special offer for business travellers, which will include some discounts, flexibility and better service, within a week,” he said.

Asked whether GoAir was planning an alliance with other LCA carriers after the Jet-Kingfisher alliance, Mr Badiali said no such discussion had yet been initiated. But personally he felt that such an alliance amongst LCA carriers, involving sharing of ground, logistics and other infrastructure, made sense for the aviation industry in the prevailing economic environment.

“I have broached the issue at a few meetings earlier. If such a development were to take place, GoAir will have no hesitation to be a part of it,” he said.

The airline on Tuesday launched a new service, branded GoComfort, a flexible premium service providing key benefits that an Indian business passenger would need. “It is India’s only low cost premium service offering business travellers a premium choice over any other low fare airline,” according to Mr. Badiali.

The flexibility and services include fully changeable tickets, lower cancellation charges, priority check-in, better seating comfort and complimentary meals. The product is offered at an additional charge of Rs 1,750 over and above the regular fares.

The airline currently operates across nine destinations through 832 flights, which will be increased to over 900 flights in the winter schedule.

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