After turning around and posting profits for four straight quarters, SpiceJet is in an expansion mode and plans to add 10-15 per cent to its fleet capacity. The company is also looking to replace the aircraft taken on wet lease by the more cost-effective dry lease ones.

Bloomberg TV India

There are talks of restructuring your fleet by replacing the costly wet lease ones with the cost-effective dry lease ones. Can you elaborate on that plan?

We’re hoping to swap them by June. These wet-lease planes were taken because we needed capacity in a short period of time. Wet-lease planes are always more expensive and tougher to operate. Therefore, the plan was always to replace them by dry lease planes.

Are there any new routes or targets that you’re looking to achieve in FY17?

We hope to add about 10-15 per cent to our existing capacity through FY17. And we hope to do that in a profitable manner by choosing profitable routes, ensuring that revenues, especially from ancillary, remain high and most importantly our operations remain stable, our flights fly on time and we have a very low number of cancellations this year.

Are you going to place any new orders in this year?

We will place a significant order for narrow body planes and we will also examine orders for regional aircrafts. We think that there is a great growth ahead in the Indian aviation space especially if the fuel prices remain moderate. We are talking to both Airbus and Boeing at this time and we hope that in the coming few months we are able to place those orders. It is important for us that we get the structure right and the pricing of those orders right along with the terms. So, it is taking a little longer than we expect, but we hope to do it soon.

There have been reports that the government might scrap the 5/20 rule that restricts new entrants to have at least 20 fleets and five years of domestic experience to be eligible for flying in overseas routes. What is your view on ?

I think we made our position quite clear on that. We think it is important that 5/20 is looked in conjunction with route-dispersal guidelines (RDGs). Obviously, all the existing airlines have fulfilled the rule. The rule is now sought to be changed at the behest of some airlines that appear, if media reports are true, to be in violation of the Indian law. So I think that government needs to carefully examine the impact of that. It is important that we build global hubs and global airlines in India, and stop adopting policies which will shift our hubs overseas as has happened in the past. We need to look at strengthening the Indian aviation sector and become a leader in global aviation. We must look seriously at this issue of substantial ownership and effective control, which is a principle that is followed by the companies and countries around the world. We must not allow people to violate Indian laws. And we must not try and change our laws for people who appear to be in apparent violation of the rules.

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