In a bid to upgrade its existing fleet, IPO-bound Go First will induct 10 A320 NEO aircraft this year, followed by 10 more by December 2023. The Wadia-owned airline has plans to expand in South East Asia and Eastern Europe besides adding at least 10 codeshare and interlining agreements this fiscal.
“This will finish our first order. Post this, in 2024, we will start accepting deliveries of the aircraft order which was placed in 2016,” said a source close to the company.
This comes even as new airlines, including Akasa and Jet Airways, are set to launch services over the next few months.
According to a source, Go First is likely to start its process for the IPO in mid-June and open its issue in July. Amid the market scenario getting better, the company is focussing on a three-pronged model — cost reduction, expansion and fleet optimisation, the source added.
As part of its strategy, Go First will first retire old A320 CEOs by 2023. Currently, the airline has 52 aircraft in its fleet and over four are A320 CEOs. The company’s plan to retire these aircraft and inducting fuel-efficient A320 NEOs was derailed because of the pandemic.
Due to the current scenario, the airline has benefitted on lease rentals. “We have saved at least 8-9 per cent better lease rentals,” the person said.
Explaining about cost reduction plans, he said, “During the pandemic, we moved most of our costs to a variable cost structure, not spreading ourselves thin. Maintaining liquidity has helped us reduce our overall costs by 14 per cent than the market leader. In the future too, our plan is to maintain liquidity and continue our variable cost structure model.”
Go First also plans to add four more destinations while increasing frequency at existing destinations. “Today we are present at 29 airports; we see the potential to connect more flights from existing airports like Delhi and Mumbai to metros or non-metros.”
For Go First, focus on leisure travel has been beneficial during Covid. “So, the idea is to be focussed on that and continue to grow the leisure market.” The company has at least nine major destinations in its network which have huge potential, he said, adding that every new station can be given at least two frequencies.
“Presently, more than 45 per cent out of our network is leisure and that percentage may continue. We will try to build more connections between metros and tier 2 cities ,” he added.