July 29, 2021: Former President of domestic carrier Indigo, Aditya Ghosh will be co-founder of India’s newest Akasa Airlines, along with market bull Rakesh Jhunjhunwala and former Jet Airways CEO Vinay Dube, sources said.
The sources said Ghosh would own less than 10 percent of Akasa and will not be part of the management but will be on the board as Jhunjhunwala’s nominee; while the market ace himself will hold 40 percent stake and Dube will have 15 percent, plus post as CEO.
Investors in Akasa include Airbnb and Par Capital Management – which has interests in US ULCC Sun Country Airlines.
Aditya Ghosh returns to aviation industry with Akasa Airlines
Akasa Air is expected to get a no-objection certificate from the aviation ministry within the next 15 days and will include a fleet of planes that can carry around 180 passengers. A Delta Airlines executive is expected to join the aviation company, Jhunjunwala said.
“For the culture of a company to be frugal you’ve to start off fresh,” he said during Wednesday’s interview.
The new ultra-low-cost carrier (ULCC) will mark Ghosh’s “return to the aviation industry” after his exit as President and whole time director of Indigo in 2018. He is currently a board member at Fab India and Oyo Rooms.
Ghosh worked at Indigo for 10 years and built it up from a new entrant into India’s biggest carrier with a fleet of 160 planes and market share of Rs 55,000 crore, the report noted
Key posts at Akasa Airlines
Other key posts at Akasa will see former Jet Airways senior VP Praveen Iyer take up COO role, while former GoAir revenue management VP Anand Srinivasan will be CTO, and former Jet flight operations VP Floyd Gracious is likely to have a similar role. Industry veteran Neelu Khatri is being billed as head of corporate affairs.
Jhunjhunwala is investing $35 million in Akasa and said he expects a no-objection certificate (NOC) from the Aviation Ministry soon. Plans are for a fleet of 70 aircraft. The new entrant in India’s aviation scene notably comes amid deep impact on the industry due to the COVID-19 pandemic.
When it comes to its fleet, Akasa is sticking firmly to the low-cost bible. The carrier plans to operate 70 aircraft in the next four years, making it one of the top five airlines in India. The large fleet will allow Akasa to grow quickly in the market and potentially tap into new routes.
Also Read: Turbulent times for IndiGo and SpiceJet as they expect a worse Q1FY22 amid second wave of COVID-19
When it comes to which aircraft, Jhunjhunwala dropped a hint only about capacity: around 180 seats. This narrows the field down to just the A320neo or 737 MAX 8 since both seat around that figure in a one-class layout.
While the airline is likely already in talks with manufacturers and lessors, the decision could tilt towards Airbus. This is due to the continued grounding of the 737 MAX in India and no timeline for recertification. However, were Akasa to purchase the MAX and request permission to operate, it could mean cash-strapped SpiceJet would no longer be needed for testing.